"The World and Japan" Database (Project Leader: TANAKA Akihiko)
Database of Japanese Politics and International Relations
National Graduate Institute for Policy Studies (GRIPS); Institute for Advanced Studies on Asia (IASA), The University of Tokyo

[Title] Trans-Pacific Partnership Agreement

[Place] Auckland
[Date] February 4, 2016
[Source] Cabinet Secretariat of Japan
[Notes]
[Full text]

Text of the Trans-Pacific Partnership Agreement


PREAMBLE

The Parties to this Agreement, resolving to:

ESTABLISH a comprehensive regional agreement that promotes economic integration to liberalise trade and investment, bring economic growth and social benefits, create new opportunities for workers and businesses, contribute to raising living standards, benefit consumers, reduce poverty and promote sustainable growth;

STRENGTHEN the bonds of friendship and cooperation between them and their peoples;

BUILD on their respective rights and obligations under the Marrakesh Agreement Establishing the World Trade Organization;

RECOGNISE the differences in their levels of development and diversity of economies;

STRENGTHEN the competitiveness of their businesses in global markets and enhance the competitiveness of their economies by promoting opportunities for businesses, including promoting the development and strengthening of regional supply chains;

SUPPORT the growth and development of micro, small and medium- sized enterprises by enhancing their ability to participate in and benefit from the opportunities created by this Agreement;

ESTABLISH a predictable legal and commercial framework for trade and investment through mutually advantageous rules;

FACILITATE regional trade by promoting efficient and transparent customs procedures that reduce costs and ensure predictability for their importers and exporters;

RECOGNISE their inherent right to regulate and resolve to preserve the flexibility of the Parties to set legislative and regulatory priorities, safeguard public welfare, and protect legitimate public welfare objectives, such as public health, safety, the environment, the conservation of living or non-living exhaustible natural resources, the integrity and stability of the financial system and public morals;

RECOGNISE further their inherent right to adopt, maintain or modify health care systems;

AFFIRM that state-owned enterprises can play a legitimate role in the diverse economies of the Parties, while recognising that the provision of unfair advantages to state-owned enterprises undermines fair and open trade and investment, and resolve to establish rules for state-owned enterprises that promote a level playing field with privately owned businesses, transparency and sound business practices;

PROMOTE high levels of environmental protection, including through effective enforcement of environmental laws, and further the aims of sustainable development, including through mutually supportive trade and environmental policies and practices;

PROTECT and enforce labour rights, improve working conditions and living standards, strengthen cooperation and the Parties' capacity on labour issues;

PROMOTE transparency, good governance and the rule of law, and eliminate bribery and corruption in trade and investment;

RECOGNISE the important work that their relevant authorities are doing to strengthen macroeconomic cooperation, including on exchange rate issues, in appropriate fora;

RECOGNISE the importance of cultural identity and diversity among and within the Parties, and that trade and investment can expand opportunities to enrich cultural identity and diversity at home and abroad;

CONTRIBUTE to the harmonious development and expansion of world trade and provide a catalyst to broader regional and international cooperation;

ESTABLISH an Agreement to address future trade and investment challenges and opportunities, and contribute to advancing their respective priorities over time; and

EXPAND their partnership by encouraging the accession of other States or separate customs territories in order to further enhance regional economic integration and create the foundation of a Free Trade Area of the Asia Pacific,

HAVE AGREED as follows:


CHAPTER 1

INITIAL PROVISIONS AND GENERAL DEFINITIONS

Section A: Initial Provisions

Article 1.1: Establishment of a Free Trade Area

The Parties, consistent with Article XXIV of GATT 1994 and Article V of GATS, hereby establish a free trade area in accordance with the provisions of this Agreement.

Article 1.2: Relation to Other Agreements

1. Recognising the Parties' intention for this Agreement to coexist with their existing international agreements, each Party affirms:

(a) in relation to existing international agreements to which all Parties are party, including the WTO Agreement, its existing rights and obligations with respect to the other Parties; and

(b) in relation to existing international agreements to which that Party and at least one other Party are party, its existing rights and obligations with respect to that other Party or Parties, as the case may be.

2. If a Party considers that a provision of this Agreement is inconsistent with a provision of another agreement to which it and at least one other Party are party, on request, the relevant Parties to the other agreement shall consult with a view to reaching a mutually satisfactory solution. This paragraph is without prejudice to a Party's rights and obligations under Chapter 28 (Dispute Settlement).

Section B: General Definitions

Article 1.3: General Definitions

For the purposes of this Agreement, unless otherwise provided in this Agreement:

AD Agreement means the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994, set out in Annex 1A to the WTO Agreement;

Agreement means the Trans-Pacific Partnership Agreement;

APEC means Asia-Pacific Economic Cooperation;

central level of government has for each Party the meaning set out in Annex 1-A (Party-Specific Definitions);

Commission means the Trans-Pacific Partnership Commission established under Article 27.1 (Establishment of the Trans-Pacific Partnership Commission);

covered investment means, with respect to a Party, an investment in its territory of an investor of another Party in existence as of the date of entry into force of this Agreement for those Parties or established, acquired, or expanded thereafter;

customs administration means the competent authority that is responsible under the laws of a Party for the administration of customs laws, regulations and, where applicable, policies, and has for each Party the meaning set out in Annex 1-A (Party-Specific Definitions);

customs duty includes any duty or charge of any kind imposed on or in

connection with the importation of a good, and any surtax or surcharge imposed in connection with such importation, but does not include any:

(a) charge equivalent to an internal tax imposed consistently with Article III:2 of GATT 1994;

(b) fee or other charge in connection with the importation commensurate with the cost of services rendered; or

(c) antidumping or countervailing duty;

Customs Valuation Agreement means the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994, set out in Annex 1A to the WTO Agreement;

days means calendar days;

enterprise means any entity constituted or organised under applicable law, whether or not for profit, and whether privately or governmentally owned or controlled, including any corporation, trust, partnership, sole proprietorship, joint venture, association or similar organisation;

existing means in effect on the date of entry into force of this Agreement;

GATS means the General Agreement on Trade in Services, set out in Annex 1B to the WTO Agreement;

GATT 1994 means the General Agreement on Tariffs and Trade 1994, set out in Annex 1A to the WTO Agreement;

goods means any merchandise, product, article or material;

goods of a Party means domestic products as these are understood in GATT 1994 or such goods as the Parties may agree, and includes originating goods of a Party;

government procurement means the process by which a government obtains the use of or acquires goods or services, or any combination thereof, for governmental purposes and not with a view to commercial sale or resale or use in the production or supply of goods or services for commercial sale or resale;

Harmonized System (HS) means the Harmonized Commodity Description and Coding System, including its General Rules of Interpretation, Section Notes, Chapter Notes and Subheading Notes as adopted and implemented by the Parties in their respective laws;

heading means the first four digits in the tariff classification number under the Harmonized System;

measure includes any law, regulation, procedure, requirement or practice;

national means a "natural person who has the nationality of a Party" according to Annex 1-A (Party-Specific Definitions) or a permanent resident of a Party;

originating means qualifying as originating under the rules of origin set out in Chapter 3 (Rules of Origin and Origin Procedures) or Chapter 4 (Textile and Apparel Goods);

Party means any State or separate customs territory for which this Agreement is in force;

person means a natural person or an enterprise;

person of a Party means a national or an enterprise of a Party;

preferential tariff treatment means the customs duty rate applicable to an originating good, pursuant to each Party's Tariff Schedule set out in Annex 2-D (Tariff Commitments);

recovered material means a material in the form of one or more individual parts that results from:

(a) the disassembly of a used good into individual parts; and

(b) the cleaning, inspecting, testing or other processing of those parts as necessary for improvement to sound working condition;

remanufactured good means a good classified in HS Chapters 84 through 90 or under heading 94.02 except goods classified under HS headings 84.18, 85.09, 85.10, and 85.16, 87.03 or subheadings 8414.51, 8450.11, 8450.12, 8508.11, and 8517.11, that is entirely or partially composed of recovered materials and:

(a) has a similar life expectancy and performs the same as or similar to such a good when new; and

(b) has a factory warranty similar to that applicable to such a good when new;

regional level of government has for each Party the meaning set out in Annex 1- A (Party-Specific Definitions);

Safeguards Agreement means the Agreement on Safeguards, set out in Annex 1A to the WTO Agreement;

sanitary or phytosanitary measure means any measure referred to in paragraph 1 of Annex A to the SPS Agreement;

SCM Agreement means the Agreement on Subsidies and Countervailing Measures, set out in Annex 1A to the WTO Agreement;

SME means a small and medium-sized enterprise, including a micro-sized enterprise;

SPS Agreement means the Agreement on the Application of Sanitary and Phytosanitary Measures, set out in Annex 1A to the WTO Agreement;

state enterprise means an enterprise that is owned, or controlled through ownership interests, by a Party;

subheading means the first six digits in the tariff classification number under the Harmonized System;

territory has for each Party the meaning set out at Annex 1-A (Party-Specific Definitions);

textile or apparel good means a good listed in Annex 4-A (Textiles and Apparel Product-Specific Rules of Origin);

TRIPS Agreement means the Agreement on Trade-Related Aspects of Intellectual Property Rights, set out in Annex 1C to the WTO Agreement;

WTO means the World Trade Organization; and

WTO Agreement means the Marrakesh Agreement Establishing the World Trade Organization, done at Marrakesh on April 15, 1994.

ANNEX 1-A

PARTY-SPECIFIC DEFINITIONS

Further to Article 1.3 (General Definitions), for the purposes of this Agreement, unless provided elsewhere in this Agreement:

central level of government means:

(a) for Australia, the Commonwealth Government;

(b) for Brunei Darussalam, the national level of government;

(c) for Canada, the Government of Canada;

(d) for Chile, the national level of government;

(e) for Japan, the Government of Japan;

(f) for Malaysia, the federal level of government;

(g) for Mexico, the federal level of government;

(h) for New Zealand, the national level of government;

(i) for Peru, the national level of government;

(j) for Singapore, the national level of government;

(k) for the United States, the federal level of government; and

(l) for Viet Nam, the national level of government;

customs administration means:

(a) for Australia, the Department of Immigration and Border Protection;

(b) for Brunei Darussalam, the Royal Customs and Excise Department;

(c) for Canada, the Canada Border Services Agency;

(d) for Chile, the National Customs Service of Chile (Servicio Nacional de Aduanas);

(e) for Japan, the Ministry of Finance;

(f) for Malaysia, the Royal Malaysian Customs Department;

(g) for Mexico, the Ministry of Finance and Public Credit (Secretaría de Hacienda y Crédito Público);

(h) for New Zealand, the New Zealand Customs Service;

(i) for Peru, the National Superintendence of Customs and Tax Administration (Superintendencia Nacional de Aduanas y de Administración Tributaria);

(j) for Singapore, the Singapore Customs;

(k) for the United States, U.S. Customs and Border Protection; and, with respect to provisions that concern enforcement, information sharing and investigations, this also means U.S. Immigration and Customs Enforcement, as applicable; and

(l) for Viet Nam, the General Department of Viet Nam Customs,

or any successor of such customs administration;

natural person who has the nationality of a Party means:

(a) for Australia, a natural person who is an Australian citizen as defined in the Australian Citizenship Act 2007, as amended from time to time, or any successor legislation;

(b) for Brunei Darussalam, a subject of His Majesty the Sultan and Yang Di-Pertuan in accordance with the laws of Brunei Darussalam;

(c) for Canada, a natural person who is a citizen of Canada under Canadian legislation;

(d) for Chile, a Chilean as defined in Article 10 of the Political Constitution of the Republic of Chile (Constitución Política de la República de Chile);

(e) for Japan, a natural person who has the nationality of Japan under its laws;

(f) for Malaysia, a natural person who is a citizen of Malaysia in accordance with its laws and regulations;

(g) for Mexico, a person who has the nationality of Mexico in accordance with its applicable laws;

(h) for New Zealand, a natural person who is a citizen as defined in the Citizenship Act 1977, as amended from time to time, or any successor legislation;

(i) for Peru, a natural person who has the nationality of Peru by birth, naturalisation or option in accordance with the Political Constitution of Peru (Constitución Política del Perú) and other relevant domestic legislation;

(j) for Singapore, a person who is a citizen of Singapore within the meaning of its Constitution and its domestic laws;

(k) for the United States, a "national of the United States" as defined in the Immigration and Nationality Act; and

(l) for Viet Nam, a natural person who is a citizen of Viet Nam within the meaning of its Constitution and its domestic laws;

regional level of government means:

(a) for Australia, a state of Australia, the Australian Capital Territory, or the Northern Territory;

(b) for Brunei Darussalam, the term regional level of government is not applicable;

(c) for Canada, a provincial or territorial government;

(d) for Chile, as a unitary Republic, the term regional level of government is not applicable;

(e) for Japan, the term regional level of government is not applicable;

(f) for Malaysia, a State of the Federation of Malaysia in accordance with the Federal Constitution of Malaysia;

(g) for Mexico, a state of the United Mexican States;

(h) for New Zealand, the term regional level of government is not applicable;

(i) for Peru, regional government in accordance with the Political Constitution of Peru (Constitución Política del Perú) and other applicable legislation;

(j) for Singapore, the term regional level of government is not applicable;

(k) for the United States, a state of the United States, the District of Columbia, or Puerto Rico; and

(l) for Viet Nam, the term regional level of government is not applicable; and

territory means:

(a) for Australia, the territory of Australia:

(i) excluding all external territories other than the Territory of Norfolk Island, the Territory of Christmas Island, the Territory of Cocos (Keeling) Islands, the Territory of Ashmore and Cartier Islands, the Territory of Heard Island and McDonald Islands, and the Coral Sea Islands Territory; and

(ii) including Australia's air space, territorial sea, contiguous zone, exclusive economic zone and continental shelf over which Australia exercises sovereign rights or jurisdiction in accordance with international law;

(b) for Brunei Darussalam, the land territory, internal waters and territorial sea of Brunei Darussalam, extending to the air space above its territorial sea, as well as to its sea-bed and subsoil over which it exercises sovereignty, and the maritime area beyond its territorial sea, which has been or may hereafter be designated under the laws of Brunei Darussalam in accordance with international law as an area over which Brunei Darussalam exercises sovereign rights and jurisdiction with respect to the seabed, the subsoil and superjacent waters to the seabed and subsoil as well as the natural resources;

(c) for Canada:

(i) the land territory, air space, internal waters and territorial seas of Canada;

(ii) the exclusive economic zone of Canada, as determined by its domestic law, consistent with Part V of the United Nations Convention on the Law of the Sea done at Montego Bay on December 10, 1982 (UNCLOS); and

(iii) the continental shelf of Canada, as determined by its

domestic law, consistent with Part VI of UNCLOS;

(d) for Chile, the land, maritime, and air space under its sovereignty, and the exclusive economic zone and the continental shelf within which it exercises sovereign rights and jurisdiction in accordance with international law and its domestic law;

(e) for Japan, the territory of Japan, and all the area beyond its territorial sea, including the sea-bed and subsoil thereof, over which Japan exercises sovereign rights or jurisdiction in accordance with international law including the UNCLOS and the laws and regulations of Japan;

(f) for Malaysia, its land territory, internal waters and territorial sea, as well as any maritime area situated beyond the territorial sea as designated or that might in the future be designated under its national law, in accordance with international law, as an area within which Malaysia exercises sovereign rights and jurisdiction with regards to the seabed, subsoil and superjacent waters to the seabed and subsoil as well as the natural resources;

(g) for Mexico:

(i) the states of the Federation and the Federal District;

(ii) the islands, including the reefs and keys, in the adjacent seas;

(iii) the islands of Guadalupe and Revillagigedo, situated in the Pacific Ocean;

(iv) the continental shelf and the submarine shelf of such islands, keys and reefs;

(v) the waters of the territorial seas, in accordance with international law, and its interior maritime waters;

(vi) the space located above the national territory, in accordance with international law; and

(vii) any areas beyond the territorial seas of Mexico within which, in accordance with international law, including the United Nations Convention on the Law of the Sea done at Montego Bay on December 10, 1982, and its domestic law, Mexico may exercise sovereign rights or jurisdiction;

(h) for New Zealand, the territory of New Zealand and the exclusive

economic zone, seabed and subsoil over which it exercises sovereign rights with respect to natural resources in accordance with international law, but does not include Tokelau;

(i) for Peru, the mainland territory, the islands, the maritime areas and the air space above them, under sovereignty or sovereign rights and jurisdiction of Peru, in accordance with the provisions of the Political Constitution of Peru (Constitución Política del Perú) and other relevant domestic law and international law;

(j) for Singapore, its land territory, internal waters and territorial sea, as well as any maritime area situated beyond the territorial sea which has been or might in the future be designated under its national law, in accordance with international law, as an area within which Singapore may exercise sovereign rights or jurisdiction with regards to the sea, the sea-bed, the subsoil and the natural resources;

(k) for the United States:

(i) the customs territory of the United States, which includes the 50 states, the District of Columbia, and Puerto Rico;

(ii) the foreign trade zones located in the United States and Puerto Rico; and

(iii) the territorial sea of the United States and any area beyond the territorial sea within which, in accordance with customary international law as reflected in the United Nations Convention on the Law of the Sea, the United States may exercise sovereign rights or jurisdiction; and

(l) for Viet Nam, the land territory, islands, internal waters, territorial sea, and air space above them, the maritime areas beyond territorial sea including seabed, subsoil and natural resources thereof over which Viet Nam exercises its sovereignty, sovereign rights or jurisdiction in accordance with its domestic laws and international law.


CHAPTER 2

NATIONAL TREATMENT AND MARKET ACCESS FOR GOODS

Section A: Definitions and Scope

Article 2.1: Definitions

For the purposes of this Chapter:

advertising films and recordings means recorded visual media or audio materials, consisting essentially of images or sound, showing the nature or operation of goods or services offered for sale or lease by a person of a Party, that are of a kind suitable for exhibition to prospective customers but not for broadcast to the general public;

Agreement on Agriculture means the Agreement on Agriculture, set out in Annex 1A to the WTO Agreement;

commercial samples of negligible value means commercial or trade samples: having a value, individually or in the aggregate as shipped, of not more than one U.S. dollar or the equivalent amount in the currency of another Party; or so marked, torn, perforated or otherwise treated that they are unsuitable for sale or for use except as commercial samples;

consular transactions means requirements that goods of a Party intended for export to the territory of another Party must first be submitted to the supervision of the consul of the importing Party in the territory of the exporting Party for the purpose of obtaining consular invoices or consular visas for commercial invoices, certificates of origin, manifests, shippers' export declarations, or any other customs documentation required on or in connection with importation;

consumed means, with respect to a good:

(m) actually consumed; or

(n) further processed or manufactured:

(i) so as to result in a substantial change in the value, form or use of the good; or

(ii) in the production of another good;

duty-free means free of customs duty;

goods admitted for sports purposes means sports requisites admitted into the territory of the importing Party for use in sports contests, demonstrations or training in the territory of that Party;

goods intended for display or demonstration includes their component parts, ancillary apparatuses and accessories;

import licensing means an administrative procedure requiring the submission of an application or other documentation, other than that generally required for customs clearance purposes, to the relevant administrative body of the importing Party as a prior condition for importation into the territory of that Party;

Import Licensing Agreement means the Agreement on Import Licensing Procedures, set out in Annex 1A to the WTO Agreement;

performance requirement means a requirement that:

(o) a given level or percentage of goods or services be exported;

(p) domestic goods or services of the Party granting a waiver of customs duties or an import licence be substituted for imported goods;

(q) a person benefiting from a waiver of customs duties or a requirement for an import licence purchase other goods or services in the territory of the Party that grants the waiver of customs duties or the import licence or accord a preference to domestically produced goods;

(r) a person benefiting from a waiver of customs duties or a requirement for an import licence produce goods or supply services in the territory of the Party that grants the waiver of customs duties or the import licence, with a given level or percentage of domestic content; or

(s) relates in any way the volume or value of imports to the volume or value of exports or to the amount of foreign exchange inflows,

but does not include a requirement that an imported good be:

(t) subsequently exported;

(u) used as a material in the production of another good that is subsequently exported;

(v) substituted by an identical or similar good used as a material in the production of another good that is subsequently exported; or

(w) substituted by an identical or similar good that is subsequently exported; and

printed advertising materials means those goods classified in Chapter 49 of the Harmonized System, including brochures, pamphlets, leaflets, trade catalogues, yearbooks published by trade associations, tourist promotional materials and posters, that are used to promote, publicise or advertise a good or service, are essentially intended to advertise a good or service, and are supplied free of charge.

Article 2.2: Scope

Unless otherwise provided in this Agreement, this Chapter applies to trade in goods of a Party.

Section B: National Treatment and Market Access for Goods

Article 2.3: National Treatment

3. Each Party shall accord national treatment to the goods of the other Parties in accordance with Article III of GATT 1994, including its interpretative notes, and to this end, Article III of GATT 1994 and its interpretative notes are incorporated into and made part of this Agreement, mutatis mutandis.

4. For greater certainty, the treatment to be accorded by a Party under paragraph 1 means, with respect to a regional level of government, treatment no less favourable than the most favourable treatment that the regional level of government accords to any like, directly competitive or substitutable goods, as the case may be, of the Party of which it forms a part.

5. Paragraph 1 shall not apply to the measures set out in Annex 2-A (National Treatment and Import and Export Restrictions).

Article 2.4: Elimination of Customs Duties

1. Unless otherwise provided in this Agreement, no Party shall increase any existing customs duty, or adopt any new customs duty, on an originating good.

2. Unless otherwise provided in this Agreement, each Party shall progressively eliminate its customs duties on originating goods in accordance with its Schedule to Annex 2-D (Tariff Commitments).

3. On request of any Party, the requesting Party and one or more other Parties shall consult to consider accelerating the elimination of customs duties set out in their Schedules to Annex 2-D (Tariff Commitments).

4. An agreement between two or more of the Parties to accelerate the elimination of a customs duty on an originating good shall supersede any duty rate or staging category determined pursuant to those Parties' Schedules to Annex 2-D (Tariff Commitments) for that good once approved by each Party to that agreement in accordance with its applicable legal procedures. The parties to that agreement shall inform the other Parties as early as practicable before the new rate of customs duty takes effect.

5. A Party may at any time unilaterally accelerate the elimination of customs duties set out in its Schedule to Annex 2-D (Tariff Commitments) on originating goods of one or more of the other Parties. A Party shall inform the other Parties as early as practicable before the new rate of customs duty takes effect.

6. For greater certainty, no Party shall prohibit an importer from claiming for an originating good the rate of customs duty applied under the WTO Agreement.

7. For greater certainty, a Party may raise a customs duty to the level set out in its Schedule to Annex 2-D (Tariff Commitments) following a unilateral reduction for the respective year.

Article 2.5: Waiver of Customs Duties

1. No Party shall adopt any new waiver of a customs duty, or expand with respect to an existing recipient or extend to any new recipient the application of an existing waiver of a customs duty, that is conditioned, explicitly or implicitly, on the fulfilment of a performance requirement.

2. No Party shall, explicitly or implicitly, condition the continuation of any existing waiver of a customs duty on the fulfilment of a performance requirement.

Article 2.6: Goods Re-entered after Repair and Alteration

1. No Party shall apply a customs duty to a good, regardless of its origin, that re-enters the Party's territory after that good has been temporarily exported from the Party's territory to the territory of another Party for repair or alteration, regardless of whether that repair or alteration could have been performed in the territory of the Party from which the good was exported for repair or alteration or increased the value of the good.

2. No Party shall apply a customs duty to a good, regardless of its origin, admitted temporarily from the territory of another Party for repair or alteration.

3. For the purposes of this Article, "repair or alteration" does not include an operation or process that:

(x) destroys a good's essential characteristics or creates a new or commercially different good; or

(y) transforms an unfinished good into a finished good.

Article 2.7: Duty-Free Entry of Commercial Samples of Negligible Value and Printed Advertising Material

Each Party shall grant duty-free entry to commercial samples of negligible value and printed advertising material imported from the territory of another Party, regardless of their origin, but may require that:

(z) commercial samples of negligible value be imported solely for the solicitation of orders for goods, or services provided from the territory, of another Party or a non-Party; or

(aa) printed advertising material be imported in packets that each contain no more than one copy of the material and that neither that material nor those packets form part of a larger consignment.

Article 2.8: Temporary Admission of Goods

1. Each Party shall grant duty-free temporary admission for the following goods, regardless of their origin:

(bb) professional equipment, including equipment for the press or television, software, and broadcasting and cinematographic equipment, that is necessary for carrying out the business activity, trade or profession of a person who qualifies for temporary entry pursuant to the laws of the importing Party;

(cc) goods intended for display or demonstration;

(dd) commercial samples and advertising films and recordings; and

(ee) goods admitted for sports purposes.

2. Each Party shall, at the request of the person concerned and for reasons its customs authority considers valid, extend the time limit for duty-free temporary admission beyond the period initially fixed.

3. No Party shall condition the duty-free temporary admission of the goods referred to in paragraph 1, other than to require that those goods:

(ff) be used solely by or under the personal supervision of a national of another Party in the exercise of the business activity, trade, profession or sport of that national of another Party;

(gg) not be sold or leased while in its territory;

(hh) be accompanied by a security in an amount no greater than the charges that would otherwise be owed on entry or final importation, releasable on exportation of the goods;

(ii) be capable of identification when imported and exported;

(jj) be exported on the departure of the national referred to in subparagraph (a), or within any other period reasonably related to the purpose of the temporary admission that the Party may establish, or within one year, unless extended;

(kk) be admitted in no greater quantity than is reasonable for their intended use; and

(ll) be otherwise admissible into the Party's territory under its laws.

4. Each Party shall grant duty-free temporary admission for containers and pallets regardless of their origin, that are in use or to be used in the shipment of goods in international traffic.

(mm) For the purposes of this paragraph, container means an article of transport equipment that is: fully or partially enclosed to constitute a compartment intended for containing goods; substantial and has an internal volume of one cubic metre or more; of a permanent character and accordingly strong enough to be suitable for repeated use; used in significant numbers in international traffic; specially designed to facilitate the carriage of goods by more than one mode of transport without intermediate reloading; and designed both for ready handling, particularly when being transferred from one mode of transport to another, and to be easy to fill and to empty, but does

not include vehicles, accessories or spare parts of vehicles or packaging.

(nn) For the purposes of this paragraph, pallet means a small, portable platform, which consists of two decks separated by bearers or a single deck supported by feet, on which goods can be moved, stacked and stored, and which is designed essentially for handling by means of fork lift trucks, pallet trucks or other jacking devices.

5. If any condition that a Party imposes under paragraph 3 has not been fulfilled, the Party may apply the customs duty and any other charge that would normally be owed on the good in addition to any other charges or penalties provided for under its law.

6. Each Party shall adopt and maintain procedures providing for the expeditious release of goods admitted under this Article. To the extent possible, those procedures shall provide that when a good admitted under this Article accompanies a national of another Party who is seeking temporary entry, the good shall be released simultaneously with the entry of that national.

7. Each Party shall permit a good temporarily admitted under this Article to be exported through a customs port other than the port through which it was admitted.

8. Each Party shall, in accordance with its law, provide that the importer or other person responsible for a good admitted under this Article shall not be liable for failure to export the good on presentation of satisfactory proof to the importing Party that the good was destroyed within the period fixed for temporary admission, including any lawful extension.

9. Subject to Chapter 9 (Investment) and Chapter 10 (Cross-Border Trade in Services):

(oo) each Party shall allow a vehicle or container used in international traffic that enters its territory from the territory of another Party to exit its territory on any route that is reasonably related to the economical and prompt departure of that vehicle or container;

(pp) no Party shall require any security or impose any penalty or charge solely by reason of any difference between the customs port of entry and the customs port of departure of a vehicle or container;

(qq) no Party shall condition the release of any obligation, including any security, that it imposes in respect of the entry of a vehicle or container into its territory on the exit of that vehicle or container through any particular customs port of departure; and

(rr) no Party shall require that the vehicle or carrier bringing a container from the territory of another Party into its territory be the same vehicle or carrier that takes that container to the territory of that other Party, or to the territory of any other Party.

10. For the purposes of paragraph 9, vehicle means a truck, a truck tractor, a tractor, a trailer unit or trailer, a locomotive, or a railway car or other railroad equipment.

Article 2.9: Ad hoc Discussions

1. Each Party shall designate and notify a contact point in accordance with Article 27.5 (Contact Points), to facilitate communications between the Parties on any matter covered by this Chapter, including any request or information conveyed under Article 26.5 (Provision of Information) relating to a measure of a Party that may affect the operation of this Chapter.

2. A Party (the requesting Party) may request ad hoc discussions on any matter arising under this Chapter (including a specific non-tariff measure) that the requesting Party believes may adversely affect its interests in trade in goods, except a matter that could be addressed under a Chapter-specific consultation mechanism established under another Chapter, by delivering a written request to another Party (the requested Party) through its contact point for this Chapter. The request shall be in writing and identify the reasons for the request, including a description of the requesting Party's concerns and an indication of the provisions of this Chapter to which the concerns relate. The requesting Party may provide all the other Parties with a copy of the request.

3. If the requested Party considers that the matter that is the subject of the request should be addressed under a Chapter-specific consultation mechanism established under another Chapter, it shall promptly notify the contact point for this Chapter of the requesting Party and include in its notice the reasons it considers that the request should be addressed under the other mechanism. The requested Party shall promptly forward the request and its notice to the overall contact points of the requesting and requested Parties designated under Article 27.5 (Contact Points) for appropriate action.

4. Within 30 days of receipt of a request under paragraph 2, the requested Party shall provide a written reply to the requesting Party. Within 30 days of the requesting Party's receipt of the reply, the requesting and requested Parties (the discussing Parties) shall meet in person or via electronic means to discuss the matter identified in the request. If the discussing Parties choose to meet in person, the meeting shall take place in the territory of the requested Party, unless the discussing Parties decide otherwise.

5. Any Party may submit a written request to the discussing Parties to participate in the ad hoc discussions. If the matter has not been resolved prior to the receipt of a Party's request to participate and the discussing Parties agree, the Party may participate in these ad hoc discussions subject to any conditions that the discussing Parties may decide.

6. If the requesting Party believes that the matter is urgent, it may request that ad hoc discussions take place within a shorter time frame than that provided for under paragraph 4. Any Party may request urgent ad hoc discussions if a measure:

(a) is applied without prior notice or without an opportunity for a Party to avail itself of ad hoc discussions under paragraphs 2, 3 and 4; and

(b) may threaten to impede the importation, sale or distribution of an originating good which is in the process of being transported from the exporting Party to the importing Party, or has not been released from customs control, or is in storage in a warehouse regulated by the customs administration of the importing Party.

7. Ad hoc discussions under this Article shall be confidential and without prejudice to the rights of any Party, including being without prejudice to rights pertaining to dispute settlement proceedings under Chapter 28 (Dispute Settlement).

Article 2.10: Import and Export Restrictions

1. Unless otherwise provided in this Agreement, no Party shall adopt or maintain any prohibition or restriction on the importation of any good of another Party or on the exportation or sale for export of any good destined for the territory of another Party, except in accordance with Article XI of GATT 1994 and its interpretative notes, and to this end Article XI of GATT 1994 and its

interpretative notes are incorporated into and made part of this Agreement, mutatis mutandis.

2. The Parties understand that GATT 1994 rights and obligations incorporated by paragraph 1 prohibit, in any circumstances in which any other form of restriction is prohibited, a Party from adopting or maintaining:

(a) export and import price requirements, except as permitted in enforcement of countervailing and antidumping duty orders and undertakings;

(b) import licensing conditioned on the fulfilment of a performance requirement; or

(c) voluntary export restraints inconsistent with Article VI of GATT 1994, as implemented under Article 18 of the SCM Agreement and Article 8.1 of the AD Agreement.

3. For greater certainty, paragraph 1 applies to the importation of commercial cryptographic goods.

4. For the purposes of paragraph 3:

commercial cryptographic goods means any good implementing or incorporating cryptography, if the good is not designed or modified specifically for government use and is sold or otherwise made available to the public.

5. Paragraphs 1 and 2 shall not apply to the measures set out in Annex 2-A (National Treatment and Import and Export Restrictions).

6. In the event that a Party adopts or maintains a prohibition or restriction on the importation from or exportation to a non-Party of a good, no provision of this Agreement shall be construed to prevent that Party from:

(d) limiting or prohibiting the importation of the good of the non-Party from the territory of another Party; or

(e) requiring, as a condition for exporting the good of that Party to the territory of another Party, that the good not be re-exported to the non-Party, directly or indirectly, without being consumed in the territory of the other Party.

7. In the event that a Party adopts or maintains a prohibition or restriction on the importation of a good from a non-Party, the Parties, on the request of any Party, shall consult with a view to avoiding undue interference with or distortion of pricing, marketing, or distribution arrangements in another Party.

8. No Party shall, as a condition for engaging in importation or for the importation of a good, require a person of another Party to establish or maintain a contractual or other relationship with a distributor in its territory.

9. For greater certainty, paragraph 8 does not prevent a Party from requiring a person referred to in that paragraph to designate a point of contact for the purpose of facilitating communications between its regulatory authorities and that person.

10. For the purposes of paragraph 8:

distributor means a person of a Party who is responsible for the commercial distribution, agency, concession or representation in the territory of that Party of goods of another Party.

Article 2.11: Remanufactured Goods

1. For greater certainty, Article 2.10.1 (Import and Export Restrictions) shall apply to prohibitions and restrictions on the importation of remanufactured goods.

2. If a Party adopts or maintains measures prohibiting or restricting the importation of used goods, it shall not apply those measures to remanufactured goods.

Article 2.12: Import Licensing

1. No Party shall adopt or maintain a measure that is inconsistent with the Import Licensing Agreement.

2. Promptly after this Agreement enters into force for a Party, that Party shall notify the other Parties of its existing import licensing procedures, if any. The notice shall include the information specified in Article 5.2 of the Import Licensing Agreement and any information required under paragraph 6.

3. A Party shall be deemed to be in compliance with the obligations in paragraph 2 with respect to an existing import licensing procedure if:

(a) it has notified that procedure to the WTO Committee on Import Licensing provided for in Article 4 of the Import Licensing Agreement together with the information specified in Article 5.2 of that agreement;

(b) in the most recent annual submission due before the date of entry into force of this Agreement for that Party to the WTO Committee on Import Licensing in response to the annual questionnaire on import licensing procedures described in Article 7.3 of the Import Licensing Agreement, it has provided, with respect to that procedure, the information requested in that questionnaire; and

(c) it has included in either the notice described in subparagraph (a) or the annual submission described in subparagraph (b) any information required to be notified to the other Parties under paragraph 6.

4. Each Party shall comply with Article 1.4(a) of the Import Licensing Agreement with respect to any new or modified import licensing procedure. Each Party shall also publish on an official government website any information that it is required to publish under Article 1.4(a) of the Import Licensing Agreement.

5. Each Party shall notify the other Parties of any new import licensing procedures it adopts and any modifications it makes to its existing import licensing procedures, if possible, no later than 60 days before the new procedure or modification takes effect. In no case shall a Party provide the notification later than 60 days after the date of its publication. The notification shall include any information required under paragraph 6. A Party shall be deemed to be in compliance with this obligation if it notifies a new import licensing procedure or a modification to an existing import licensing procedure to the WTO Committee on Import Licensing in accordance with Article 5.1, 5.2 or 5.3 of the Import Licensing Agreement, and includes in its notification any information required to be notified to the other Parties under paragraph 6.

6. (a) A notice under paragraph 2, 3 or 5 shall state if, under any import licensing procedure that is a subject of the notice:

(i) the terms of an import licence for any product limit the permissible end users of the product; or

(ii) the Party imposes any of the following conditions on eligibility for obtaining a licence to import any product:

(A) membership in an industry association;

(B) approval by an industry association of the request for an import licence;

(C) a history of importing the product or similar products;

(D) minimum importer or end user production capacity;

(E) minimum importer or end user registered capital; or

(F) a contractual or other relationship between the importer and a distributor in the Party's territory.

(b) A notice that states, under subparagraph (a), that there is a limitation on permissible end users or a licence-eligibility condition shall:

(i) list all products for which the end-user limitation or licence- eligibility condition applies; and

(ii) describe the end-user limitation or licence-eligibility condition.

7. Each Party shall respond within 60 days to a reasonable enquiry from another Party concerning its licensing rules and its procedures for the submission of an application for an import licence, including the eligibility of persons, firms and institutions to make an application, the administrative body or bodies to be approached and the list of products subject to the licensing requirement.

8. If a Party denies an import licence application with respect to a good of another Party, it shall, on request of the applicant and within a reasonable period after receiving the request, provide the applicant with a written explanation of the reason for the denial.

9. No Party shall apply an import licensing procedure to a good of another Party unless it has, with respect to that procedure, met the requirements of paragraph 2 or 4, as applicable.

Article 2.13: Transparency in Export Licensing Procedures

1. For the purposes of this Article:

export licensing procedure means a requirement that a Party adopts or maintains under which an exporter must, as a condition for exporting a good from the Party's territory, submit an application or other documentation to an administrative body or bodies, but does not include customs documentation required in the normal course of trade or any requirement that must be fulfilled prior to introduction of the good into commerce within the Party's territory.

2. Within 30 days of the date of entry into force of this Agreement for a Party, that Party shall notify the other Parties in writing of the publications in which its export licensing procedures, if any, are set out, including addresses of relevant government websites. Thereafter, each Party shall publish in the notified publications and websites any new export licensing procedure, or any modification of an export licensing procedure, that it adopts as soon as practicable but no later than 30 days after the new procedure or modification takes effect.

3. Each Party shall ensure that it includes in the publications it notifies under paragraph 2:

(a) the texts of its export licensing procedures, including any modifications it makes to those procedures;

(b) the goods subject to each licensing procedure;

(c) for each procedure, a description of:

(i) the process for applying for a licence; and

(ii) any criteria an applicant must meet to be eligible to apply for a licence, such as possessing an activity licence, establishing or maintaining an investment, or operating through a particular form of establishment in a Party's territory;

(d) a contact point or points from which interested persons can obtain further information on the conditions for obtaining an export licence;

(e) the administrative body or bodies to which an application for a licence or other relevant documentation must be submitted;

(f) a description of or a citation to a publication reproducing in full any measure or measures that the export licensing procedure is designed to implement;

(g) the period during which each export licensing procedure will be in effect, unless the procedure will remain in effect until withdrawn or revised in a new publication;

(h) if the Party intends to use a licensing procedure to administer an export quota, the overall quantity and, if practicable, value of the quota and the opening and closing dates of the quota; and

(i) any exemptions or exceptions available to the public that replace the requirement to obtain an export licence, how to request or use these exemptions or exceptions and the criteria for them.

4. Except where doing so would reveal business proprietary or other confidential information of a particular person, on request of another Party that has a substantial trade interest in the matter, a Party shall provide, to the extent possible, the following information regarding a particular export licensing procedure that it adopts or maintains:

(a) the aggregate number of licences that the Party has granted over a recent period that the requesting Party has specified; and

(b) measures, if any, that the Party has taken in conjunction with the licensing procedure to restrict domestic production or consumption or to stabilise production, supply or prices for the relevant good.

5. Nothing in this Article shall be construed in a manner that would require a Party to grant an export licence, or that would prevent a Party from implementing its obligations or commitments under United Nations Security Council Resolutions, as well as multilateral non-proliferation regimes, including: the Wassenaar Arrangement on Export Controls for Conventional Arms and Dual- Use Goods and Technologies; the Nuclear Suppliers Group; the Australia Group; the Convention on the Prohibition of the Development, Production, Stockpiling

and Use of Chemical Weapons and on Their Destruction, done at Paris, January 13, 1993; the Convention on the Prohibition of the Development, Production and Stockpiling of Bacteriological (Biological) and Toxin Weapons and on Their Destruction, done at Washington, London, and Moscow, April 10, 1972; the

Treaty on the Non-Proliferation of Nuclear Weapons, done at London, Moscow and Washington, July 1, 1968; and the Missile Technology Control Regime.

Article 2.14: Administrative Fees and Formalities

1. Each Party shall ensure, in accordance with Article VIII:1 of GATT 1994 and its interpretative notes, that all fees and charges of whatever character (other than export taxes, customs duties, charges equivalent to an internal tax or other internal charge applied consistently with Article III:2 of GATT 1994, and antidumping and countervailing duties) imposed on or in connection with importation or exportation are limited in amount to the approximate cost of services rendered and do not represent an indirect protection to domestic goods or a taxation of imports or exports for fiscal purposes.

2. No Party shall require consular transactions, including related fees and charges, in connection with the importation of a good of another Party.

3. Each Party shall make publicly available online a current list of the fees and charges it imposes in connection with importation or exportation.

4. No Party shall levy fees and charges on or in connection with importation or exportation on an ad valorem basis.

5. Each Party shall periodically review its fees and charges, with a view to reducing their number and diversity if practicable.

Article 2.15: Export Duties, Taxes or Other Charges

Except as provided for in Annex 2-C (Export Duties, Taxes or Other Charges), no Party shall adopt or maintain any duty, tax or other charge on the export of any good to the territory of another Party, unless such duty, tax or charge is adopted or maintained on that good when destined for domestic consumption.

Article 2.16: Publication

Each Party shall promptly publish the following information in a non- discriminatory and easily accessible manner, in order to enable interested parties to become acquainted with it:

(a) importation, exportation and transit procedures, including port, airport and other entry-point procedures, and required forms and documents;

(b) applied rates of duties, and taxes of any kind imposed on or in connection with importation or exportation;

(c) rules for the classification or the valuation of products for customs purposes;

(d) laws, regulations and administrative rulings of general application relating to rules of origin;

(e) import, export or transit restrictions or prohibitions;

(f) fees and charges imposed on or in connection with importation, exportation or transit;

(g) penalty provisions against breaches of import, export or transit formalities;

(h) appeal procedures;

(i) agreements or parts of agreements with any country relating to importation, exportation or transit;

(j) administrative procedures relating to the imposition of tariff quotas; and

(k) correlation tables showing correspondence between any new national nomenclature and the previous national nomenclature.

Article 2.17: Trade in Information Technology Products

Each Party shall be a participant in the WTO Ministerial Declaration on Trade in Information Technology Products (Information Technology Agreement), 13 December 1996, and have completed the procedures for modification and rectification of its Schedule of Tariff Concessions set out in the Decision of 26 March 1980, L/4962, in accordance with paragraph 2 of the Information Technology Agreement.

Article 2.18: Committee on Trade in Goods

1. The Parties hereby establish a Committee on Trade in Goods (Committee), composed of government representatives of each Party.

2. The Committee shall meet as necessary to consider any matters arising under this Chapter. During the first five years after entry into force of this Agreement, the Committee shall meet no less than once a year.

3. The Committee's functions shall include:

(a) promoting trade in goods between the Parties, including through consultations on accelerating tariff elimination under this Agreement and other issues as appropriate;

(b) addressing barriers to trade in goods between the Parties, other than those within the competence of other committees, working groups or any other subsidiary bodies established under this Agreement, especially those related to the application of non-tariff measures and, if appropriate, refer these matters to the Commission for its consideration;

(c) reviewing the future amendments to the Harmonized System to ensure that each Party's obligations under this Agreement are not altered, including by establishing, as needed, guidelines for the transposition of Parties' Schedules to Annex 2-D (Tariff Commitments) and consulting to resolve any conflicts between:

(i) amendments to the Harmonized System and Annex 2-D (Tariff Commitments); or

(ii) Annex 2-D (Tariff Commitments) and national nomenclatures;

(d) consulting on and endeavouring to resolve any differences that may arise between the Parties on matters related to the classification of goods under the Harmonized System and Annex 2-D (Tariff Commitments); and

(e) undertaking any additional work that the Commission may assign to it.

4. The Committee shall consult, as appropriate, with other committees established under this Agreement when addressing issues of relevance to those committees.

5. The Committee shall, within two years of the date of entry into force of this Agreement, submit to the Commission an initial report on its work under paragraphs 3(a) and 3(b). In producing this report, the Committee shall consult, as appropriate, with the Committee on Agricultural Trade established under Article 2.25 (Committee on Agricultural Trade) and the Committee on Textile and Apparel Trade Matters established under Chapter 4 (Textile and Apparel Goods) of this Agreement on portions of the report of relevance to those committees.

Section C: Agriculture

Article 2.19: Definitions

For the purposes of this Section:

agricultural goods means those goods referred to in Article 2 of the Agreement on Agriculture;

export subsidies shall have the meaning assigned to that term in Article 1(e) of the Agreement on Agriculture, including any amendment of that Article;

modern biotechnology means the application of:

(a) in vitro nucleic acid techniques, including recombinant deoxyribonucleic acid (rDNA) and direct injection of nucleic acid into cells or organelles; or

(b) fusion of cells beyond the taxonomic family,

that overcome natural physiological reproductive or recombinant barriers and that are not techniques used in traditional breeding and selection; and

products of modern biotechnology means agricultural goods, as well as fish and fish products , developed using modern biotechnology, but does not include medicines and medical products.

Article 2.20: Scope

This Section shall apply to measures adopted or maintained by a Party relating to trade in agricultural goods.

Article 2.21: Agricultural Export Subsidies

1. The Parties share the objective of the multilateral elimination of export subsidies for agricultural goods and shall work together to achieve an agreement in the WTO to eliminate those subsidies and prevent their reintroduction in any form.

2. No Party shall adopt or maintain any export subsidy on any agricultural good destined for the territory of another Party.

Article 2.22: Export Credits, Export Credit Guarantees or Insurance Programmes

Recognising the ongoing work in the WTO in the area of export competition and that export competition remains a key priority in multilateral negotiations, Parties shall work together in the WTO to develop multilateral disciplines to govern the provision of export credits, export credit guarantees and insurance programmes, including disciplines on matters such as transparency, self-financing and repayment terms.

Article 2.23: Agricultural Export State Trading Enterprises

The Parties shall work together toward an agreement in the WTO on export state trading enterprises that requires:

(a) the elimination of trade distorting restrictions on the authorisation to export agricultural goods;

(b) the elimination of any special financing that a WTO Member grants directly or indirectly to state trading enterprises that export for sale a significant share of the Member's total exports of an agricultural good; and

(c) greater transparency regarding the operation and maintenance of export state trading enterprises.

Article 2.24: Export Restrictions – Food Security

1. Parties recognise that under Article XI:2(a) of GATT 1994, a Party may temporarily apply an export prohibition or restriction that is otherwise prohibited under Article XI:1 of GATT 1994 on foodstuffs to prevent or relieve a critical shortage of foodstuffs, subject to meeting the conditions set out in Article 12.1 of the Agreement on Agriculture.

2. In addition to the conditions set out in Article 12.1 of the Agreement on Agriculture under which a Party may apply an export prohibition or restriction, other than a duty, tax or other charge, on foodstuffs:

(a) a Party that:

(i) imposes such a prohibition or restriction on the exportation or sale for export of foodstuffs to another Party to preventor relieve a critical shortage of foodstuffs, shall in all cases notify the measure to the other Parties prior to the date it takes effect and, except when the critical shortage is caused by an event constituting force majeure, shall notify the measure to the other Parties at least 30 days prior to the date it takes effect; or

(ii) as of the date of entry into force of this Agreement for that Party, maintains such a prohibition or restriction, shall, within 30 days of that date, notify the measure to the other Parties.

(b) A notification under this paragraph shall include the reasons for imposing or maintaining the prohibition or restriction, as well as an explanation of how the measure is consistent with Article XI:2(a) of GATT 1994, and shall note alternative measures, if any, that the Party considered before imposing the prohibition or restriction.

(c) A measure shall not be subject to notification under this paragraph or paragraph 4 if it prohibits or restricts the exportation or sale for export only of a foodstuff or foodstuffs of which the Party imposing the measure has been a net importer during each of the three calendar years preceding the imposition of the measure, excluding the year in which the Party imposes the measure.

(d) If a Party that adopts or maintains a measure referred to in subparagraph (a) has been a net importer of each foodstuff subject to that measure during each of the three calendar years preceding imposition of the measure, excluding the year in which the Party imposes the measure, and that Party does not provide the other Parties with a notification under subparagraph (a), the Party shall, within a reasonable period of time, provide to the other Parties trade data demonstrating that it was a net importer of the foodstuff or foodstuffs during these three calendar years.

3. A Party that is required to notify a measure under paragraph 2(a) shall:

(a) consult, on request, with any other Party having a substantial interest as an importer of the foodstuffs subject to the measure, with respect to any matter relating to the measure;

(b) on the request of any Party having a substantial interest as an importer of the foodstuffs subject to the measure, provide that Party with relevant economic indicators bearing on whether a critical shortage within the meaning of Article XI:2(a) of GATT 1994 exists or is likely to occur in the absence of the measure, and on how the measure will prevent or relieve the critical shortage; and

(c) respond in writing to any question posed by any other Party regarding the measure within 14 days of receipt of the question.

4. A Party which considers that another Party should have notified a measure under paragraph 2(a) may bring the matter to the attention of that other Party. If the matter is not satisfactorily resolved promptly thereafter, the Party which considers that the measure should have been notified may itself bring the measure to the attention of the other Parties.

5. A Party should ordinarily terminate a measure subject to notification under paragraph 2(a) or 4 within six months of the date it is imposed. A Party contemplating continuation of a measure beyond six months from the date it is imposed shall notify the other Parties no later than five months after the date the measure is imposed and provide the information specified in paragraph 2(b). Unless the Party has consulted with the other Parties that are net importers of any foodstuff the exportation of which is prohibited or restricted under the measure, the Party shall not continue the measure beyond 12 months from the date it is imposed. The Party shall immediately discontinue the measure when the critical shortage, or threat thereof, ceases to exist.

6. No Party shall apply any measure that is subject to notification under paragraph 2(a) or 4 to food purchased for non-commercial humanitarian purposes.

Article 2.25: Committee on Agricultural Trade

1. The Parties hereby establish a Committee on Agricultural Trade, composed of government representatives of each Party.

2. The Committee on Agricultural Trade shall provide a forum for:

(a) promoting trade in agricultural goods between the Parties under this Agreement and other issues as appropriate;

(b) monitoring and promoting cooperation on the implementation and administration of this Section, including notification of export restrictions on foodstuffs as stipulated in Article 2.24 (Export Restrictions – Food Security), and discussing the cooperative work identified in Article 2.21 (Agricultural Export Subsidies), Article 2.22 (Export Credits, Export Credit Guarantees or Insurance Programmes) and Article 2.23 (Agricultural Export State Trading Enterprises);

(c) consultation among the Parties on matters related to this Section in coordination with other committees, working groups or any other subsidiary bodies established under this Agreement; and

(d) undertaking any additional work that the Committee on Trade in Goods and the Commission may assign.

3. The Committee on Agricultural Trade shall meet as necessary. During the first five years after entry into force of this Agreement, the Committee on Agricultural Trade shall meet no less than once a year.

Article 2.26: Agricultural Safeguards

Originating agricultural goods from any Party shall not be subject to any duties applied by a Party pursuant to a special safeguard taken under the Agreement on Agriculture.

Article 2.27: Trade of Products of Modern Biotechnology

1. The Parties confirm the importance of transparency, cooperation and exchanging information related to the trade of products of modern biotechnology.

2. Nothing in this Article shall prevent a Party from adopting measures in accordance with its rights and obligations under the WTO Agreement or other provisions of this Agreement.

3. Nothing in this Article shall require a Party to adopt or modify its laws, regulations and policies for the control of products of modern biotechnology within its territory.

4. Each Party shall, when available and subject to its laws, regulations and policies, make available publicly:

(a) any documentation requirements for completing an application for the authorisation of a product of modern biotechnology;

(b) a summary of any risk or safety assessment that has led to the authorisation of a product of modern biotechnology; and

(c) a list or lists of the products of modern biotechnology that have been authorised in its territory.

5. Each Party shall designate and notify a contact point or contact points for the sharing of information on issues related to low level presence (LLP) occurrences, in accordance with Article 27.5 (Contact Points).

6. In order to address an LLP occurrence, and with a view to preventing a future LLP occurrence, on request of an importing Party, an exporting Party shall, when available and subject to its laws, regulations and policies:

(a) provide a summary of the risk or safety assessment or assessments, if any, that the exporting Party conducted in connection with an authorisation of a specific plant product of modern biotechnology;

(b) provide, if known to the exporting Party, contact information for any entity within its territory that received authorisation for the plant product of modern biotechnology and which the Party believes is likely to possess:

(i) any validated methods that exist for the detection of the plant product of modern biotechnology found at a low level in a shipment;

(ii) any reference samples necessary for the detection of the LLP occurrence; and

(iii) relevant information that can be used by the importing Party to conduct a risk or safety assessment or, if a food safety assessment is appropriate, relevant information for a food safety assessment in accordance with Annex 3 of the Codex Guideline for the Conduct of Food Safety Assessment of Foods Derived from Recombinant-DNA Plants (CAC/GL 45-2003); and

(c) encourage an entity referred to in subparagraph (b) to share the information referred to in subparagraphs (b)(i), (b)(ii) and (b)(iii) with the importing Party.

7. In the event of an LLP occurrence, the importing Party shall, subject to its laws, regulations and policies:

(a) inform the importer or the importer's agent of the LLP occurrence and of any additional information that the importer will be required to submit to allow the importing Party to make a decision on the disposition of the shipment in which the LLP occurrence has been found;

(b) if available, provide to the exporting Party a summary of any risk or safety assessment that the importing Party has conducted in connection with the LLP occurrence; and

based on the Codex Guideline for the Conduct of a Food Safety Assessment of Foods Derived from Recombinant-DNA Plants (CAC/GL 45-2003).

(c) ensure that the measures applied to address the LLP occurrence are appropriate to achieve compliance with its laws, regulations and policies.

8. To reduce the likelihood of trade disruptions from LLP occurrences:

(a) each exporting Party shall, consistent with its laws, regulations and policies, endeavour to encourage technology developers to submit applications to Parties for authorisation of plants and plant products of modern biotechnology; and

(b) a Party authorising plant and plant products derived from modern biotechnology shall endeavour to:

(i) allow year-round submission and review of applications for authorisation of plants and plant products of modern biotechnology; and

(ii) increase communications between the Parties regarding new authorisations of plants and plant products of modern biotechnology so as to improve global information exchange.

9. The Parties hereby establish a working group on products of modern biotechnology (Working Group) under the Committee on Agricultural Trade for information exchange and cooperation on trade-related matters associated with products of modern biotechnology. The Working Group shall be comprised of government representatives of Parties that inform, in writing, the Committee on Agricultural Trade that they will participate in the Working Group and name one or more government representatives to the Working Group.

10. The Working Group shall provide a forum to:

(a) exchange, subject to a Party's laws, regulations and policies, information on issues, including on actual and proposed laws, regulations and policies, related to the trade of products of modern biotechnology; and

(b) further enhance cooperation between two or more Parties, when there is mutual interest, related to the trade of products of modern biotechnology.

Section D: Tariff-Rate Quota Administration

Article 2.28: Scope and General Provisions

1. Each Party shall implement and administer tariff-rate quotas (TRQs) in accordance with Article XIII of GATT 1994, including its interpretative notes, the Import Licensing Agreement and Article 2.12 (Import Licensing). All TRQs established by a Party under this Agreement shall be incorporated into that Party's Schedule to Annex 2-D (Tariff Commitments).

2. Each Party shall ensure that its procedures for administering its TRQs are made available to the public, are fair and equitable, are no more administratively burdensome than absolutely necessary, are responsive to market conditions and are administered in a timely manner.

3. The Party administering a TRQ shall publish all information concerning its TRQ administration, including the size of quotas and eligibility requirements; and, if the TRQ will be allocated, application procedures, the application deadline, and the methodology or procedures that will be used for the allocation or reallocation, on its designated publicly available website at least 90 days prior to the opening date of the TRQ concerned.

Article 2.29: Administration and Eligibility

1. Each Party shall administer its TRQs in a manner that allows importers the opportunity to utilise TRQ quantities fully.

2. (a) Except as provided in subparagraphs (b) and (c), no Party shall

introduce a new or additional condition, limit or eligibility requirement on the utilisation of a TRQ for importation of a good, including in relation to specification or grade, permissible end-use of the imported product or package size, beyond those set out in its Schedule to Annex 2-D (Tariff Commitments).

(b) A Party seeking to introduce a new or additional condition, limit or eligibility requirement on the utilisation of a TRQ for importation of a good shall notify the other Parties at least 45 days prior to the proposed effective date of the new or additional condition, limit or

eligibility requirement. Any Party with a demonstrable commercial interest in supplying the good may submit a written request for consultations to the Party seeking to introduce the new or additional condition, limit or eligibility requirement. On receipt of such a request for consultations, the Party seeking to introduce the new or additional condition, limit or eligibility requirement shall promptly undertake consultations with the Party that submitted the request, in accordance with Article 2.32.6 (Transparency).

(c) The Party seeking to introduce the new or additional condition, limit or eligibility requirement may do so if:

(i) it has consulted with any Party with a demonstrable commercial interest in supplying the good that has submitted a written request for consultations pursuant to subparagraph (b); and

(ii) no Party with a demonstrable commercial interest in supplying the good that submitted a written request for consultations pursuant to subparagraph (b) objected, after the consultation, to the introduction of the new or additional condition, limit or eligibility requirement.

(d) A new or additional condition, limit or eligibility requirement that is the outcome of any consultation held pursuant to subparagraph (c), shall be circulated to the Parties prior to its implementation.

Article 2.30: Allocation

1. In the event that access under a TRQ is subject to an allocation mechanism, each importing Party shall ensure that:

(a) any person of a Party that fulfils the importing Party's eligibility requirements is able to apply and to be considered for a quota allocation under the TRQ;

(b) unless otherwise agreed, it does not allocate any portion of the quota to a producer group, condition access to an allocation on the purchase of domestic production or limit access to an allocation to processors;

(c) each allocation is made in commercially viable shipping quantities and, to the maximum extent possible, in the amounts that importers request;

(d) an allocation for in-quota imports is applicable to any tariff lines subject to the TRQ and is valid throughout the TRQ year;

(e) if the aggregate TRQ quantity requested by applicants exceeds the quota size, allocation to eligible applicants shall be conducted by equitable and transparent methods;

(f) applicants have at least four weeks after the opening of the application period to submit their applications; and

(g) quota allocation takes place no later than four weeks before the opening of the quota period, unless the allocation is based in whole or in part on import performance during the 12-month period immediately preceding the quota period. If the Party bases the allocation in whole or in part on import performance during the 12- month period immediately preceding the quota period, the Party shall make a provisional allocation of the full quota amount no later than four weeks before the opening of the quota period. All final allocation decisions, including any revisions, shall be made and communicated to applicants by the beginning of the quota period.

2. During the first TRQ year that this Agreement is in force for a Party, if less than 12 months remain in the TRQ year on the date of entry into force of this Agreement for that Party, the Party shall make available to quota applicants, beginning on the date of entry into force of this Agreement for that Party, the

quota quantity established in its Schedule to Annex 2-D (Tariff Commitments), multiplied by a fraction the numerator of which shall be a whole number consisting of the number of months remaining in the TRQ year on the date of entry into force of this Agreement for that Party, including the entirety of the month in which this Agreement enters into force for that Party, and the denominator of which shall be 12. The Party shall make the entire quota quantity established in its Schedule to Annex 2-D (Tariff Commitments) available to quota applicants beginning on the first day of each TRQ year thereafter that the quota is in operation.

3. The Party administering a TRQ shall not require the re-export of a good as a condition for application for, or utilisation of, a quota allocation.

4. Any quantity of goods imported under a TRQ under this Agreement shall not be counted towards, or reduce the quantity of, any other TRQ provided for such goods in a Party's Schedule to the WTO Agreement or under any other trade agreements.

Article 2.31: Return and Reallocation of TRQs

1. When a TRQ is administered by an allocation mechanism, a Party shall ensure that there is a mechanism for the return and reallocation of unused allocations in a timely and transparent manner that provides the greatest possible opportunity for the TRQ to be filled.

2. Each Party shall publish on a regular basis on its designated publicly available website all information concerning amounts allocated, amounts returned and, if available, quota utilisation rates. In addition, each Party shall publish on the same website amounts available for reallocation and the application deadline, at least two weeks prior to the date on which the Party will begin accepting applications for reallocations.

Article 2.32: Transparency

1. Each Party shall identify the entity or entities responsible for administering its TRQs and designate and notify at least one contact point, in accordance with Article 27.5 (Contact Points), to facilitate communications between the Parties on matters relating to the administration of its TRQs. Each Party shall promptly notify the other Parties of any amendments to the details of its contact point.

2. When a TRQ is administered by an allocation mechanism, the name and address of allocation holders shall be published on the designated publicly available website.

3. When a TRQ is administered on a first-come, first-served basis, over the course of each year, the importing Party's administering authority shall publish, in a timely and continually on-going manner on its designated publicly available website, utilisation rates and remaining available quantities for each TRQ.

4. When a TRQ of an importing Party that is administered on a first-come, first-served basis fills, that Party shall publish a notice to this effect on its designated publicly available website within 10 days.

5. When a TRQ of an importing Party that is administered by an allocation mechanism fills, that Party shall publish a notice to this effect on its designated publicly available website as early as practicable.

6. On written request of an exporting Party or Parties, the Party administrating a TRQ shall consult with the requesting Party or Parties regarding the administration of its TRQ.


ANNEX 2-A

NATIONAL TREATMENT AND IMPORT AND EXPORT RESTRICTIONS

1. For greater certainty, nothing in this Annex shall affect the rights or obligations of any Party under the WTO Agreement with respect to any measure listed in this Annex.

2. Article 2.3.1 (National Treatment), Article 2.10.1 (Import and Export Restrictions) and Article 2.10.2 shall not apply to the continuation, renewal, or amendment made to any law, statute, decree or administrative regulations giving rise to a measure set out in this Annex to the extent that the continuation, renewal, or amendment does not decrease the conformity of the measure listed with Article 2.3 (National Treatment) and Article 2.10 (Import and Export Restrictions).

Measures of Brunei Darussalam

Article 2.10.1 (Import and Export Restrictions) and Article 2.10.2 shall not apply to the goods specified in section 31 of Customs Order 2006.

Measures of Canada

1. Article 2.3.1 (National Treatment), Article 2.10.1 (Import and Export Restrictions) and Article 2.10.2 shall not apply to:

(a) the export of logs of all species;

(b) the export of unprocessed fish pursuant to applicable provincial legislation;

(c) the importation of goods of the prohibited provisions of tariff items 9897.00.00, 9898.00.00 and 9899.00.00 referred to in the Schedule of the Customs Tariff;

(d) Canadian excise duties on absolute alcohol, as listed under tariff item 2207.10.90 in Canada's Schedule of Concessions annexed to GATT 1994 (Schedule V), used in manufacturing under the provisions of the Excise Act, 2001, Statutes of Canada 2002, c.22, as amended;

(e) the use of ships in the coasting trade of Canada; and

(f) the internal sale and distribution of wine and distilled spirits.

2. Article 2.3.1 (National Treatment) shall not apply, as specified in Article 2.3.3, to a measure affecting the production, publication, exhibition or sale of goods that supports the creation, development or accessibility of Canadian artistic expression or content.

Measures of Chile

Article 2.10.1 (Import and Export Restrictions) and Article 2.10.2 shall not apply to measures of Chile relating to imports of used vehicles.

Measures of Mexico

1. Article 2.10.1 (Import and Export Restrictions) and Article 2.10.2 shall not apply:

(a) to restrictions pursuant to Article 48 of the Hydrocarbons Law (Ley de Hidrocarburos) published in Mexico's Official Gazette (Diario Oficial de la Federación) on August 11, 2014, on the exportation from Mexico of the goods provided for in the following items of Mexico's tariff schedule of the General Import and Export Duties Law (Tarifa de la Ley de los Impuestos Generales de Importación y de Exportación) published in Mexico's Official Gazette (Diario Oficial de la Federación) on June 18, 2007 and June 29, 2012:

(b) during the period prior to January 1, 2019, to prohibitions or restrictions on the importation into Mexico of gasoline and diesel fuel set forth in Article 123 of the Hydrocarbons Law (Ley de Hidrocarburos), published in Mexico's Official Gazette (Diario Oficial de la Federación) on August 11, 2014; and

(c) to prohibitions or restrictions on the importation into Mexico of used tyres, used apparel, used vehicles and used chassis equipped with vehicle motors set forth in paragraphs 1(I) and 5 of Annex 2.2.1 of the Resolution through which the Ministry of Economy establishes Rules and General Criteria on International Trade (Acuerdo por el que la Secretaría de Economía emite reglas y criterios de carácter general en materia de Comercio Exterior), published in Mexico's Official Gazette (Diario Oficial de la Federación) on December 31, 2012.

2. The Commission shall review paragraph 1(a) pursuant to any review conducted under Article 27.2.1(b) (Functions of the Commission).

Measures of Peru

Article 2.3.1 (National Treatment), Article 2.10.1 (Import and Export Restrictions) and Article 2.10.2 shall not apply to:

(a) used clothing and footwear pursuant to Law No. 28514 of May 23, 2005;

(b) used vehicles and used automotive engines, parts and replacements pursuant to Legislative Decree No. 843 of August 30, 1996, Urgent Decree No. 079-2000 of September 20, 2000, Urgent Decree No. 050-2008 of December 18, 2008;

(c) used tyres pursuant to Supreme Decree No. 003-97-SA of June 7, 1997; and

(d) used goods, machinery and equipment which utilise radioactive energy sources pursuant to Law No. 27757 of June 19, 2002.

Measures of the United States

Article 2.3.1 (National Treatment), Article 2.10.1 (Import and Export Restrictions) and Article 2.10.2 shall not apply to:

(a) controls on the export of logs of all species; and

(b) measures under existing provisions of the Merchant Marine Act of 1920, the Passenger Vessel Act, and 46 U.S.C. § 12102, § 12113, and § 12116, to the extent that such measures were mandatory legislation at the time of the accession of the United States to the General Agreement on Tariffs and Trade 1947 (GATT 1947) and have not been amended so as to decrease their conformity with Part II of GATT 1947.

Measures of Viet Nam

Article 2.10.1 (Import and Export Restrictions) and Article 2.10.2 shall not apply to:

(a) a prohibition on importation, set out in Decree No. 187/2013/ND- CP dated 20 November 2013 of the Government of Viet Nam or Circular No. 04/2014/TT-BCT dated 27 January 2014 of the Ministry of Industry and Trade guiding the implementation of the Decree No. 187/2013/ND-CP, with respect to a good listed in (i) through (iv) of this subparagraph. The goods listed in (i) through (iv) of this subparagraph are:

(i) right-hand drive motor vehicles (including right-hand drive motor vehicles modified after manufacture to be left-hand drive vehicles), except specialised right-hand drive vehicles that generally operate in small areas such as cranes, trench and canal digging machines, garbage trucks, road sweepers, road construction trucks, airport passenger transportation buses, fork-lifts used at warehouses and ports;

(ii) vehicle components usable exclusively in right-hand drive motor vehicles that are not specialised right-hand drive vehicles;

(iii) motor vehicles more than five years old;

(iv) used:

(A) textiles, clothing and footwear;

(B) computer printers, fax machines, and computer disk drives;

(C) laptop computers;

(D) refrigeration equipment;

(E) household electrical appliances;

(F) medical equipment;

(G) furniture;

(H) household goods made from porcelain, clay, glass, metal, resin, rubber, and plastic;

(I) frames, tyres (outer and inner), tubes, accessories, and engines, of automobiles, tractors, and other motor vehicles;

(J) internal combustion engines with a capacity below 30 CV and machines with an internal combustion engine with a capacity below 30 CV; and

(K) bicycles and tricycles; and

(b) a prohibition on exportation, set out in Decree No. 187/2013/ND- CP dated 20 November 2013 of the Government of Viet Nam or Circular No. 04/2014/TT-BCT dated 27 January 2014 of the Ministry of Industry and Trade guiding the implementation of the Decree No. 187/2013/ND-CP, with respect to a good listed in (i) and (ii) of this subparagraph. The goods listed in (i) and (ii) of this subparagraph are:

(i) round and sawn timber produced from domestic natural forests; and

(ii) wooden products (except handicrafts and products produced from wood of cultivated forests, imported wood or artificial pallet).

Kimberley Process Certification Scheme

Article 2.10.1 (Import and Export Restrictions) and Article 2.10.2 shall not apply to the import and export of rough diamonds (HS codes 7102.10, 7102.21 and 7102.31), pursuant to the Kimberley Process Certification Scheme and any subsequent amendments to that scheme.


ANNEX 2-B

REMANUFACTURED GOODS

1. Article 2.11.2 (Remanufactured Goods) shall not apply to measures of Viet Nam prohibiting or restricting the importation of remanufactured goods for three years after the date of entry into force of this Agreement for Viet Nam. Thereafter, Article 2.11.2 (Remanufactured Goods) shall apply to all measures of Viet Nam, except as provided in paragraph 2 of this Annex.

2. Article 2.11.2 (Remanufactured Goods) shall not apply to a prohibition or restriction set out in Decree No. 187/2013/ND-CP dated 20 November 2013 of the Government of Viet Nam or Circular No. 04/2014/TT-BCT dated 27 January 2014 of the Ministry of Industry and Trade on the importation of a good listed in Table 2-B-1.

3. For greater certainty, Viet Nam shall not:

(a) apply any prohibition or restriction on the importation of a remanufactured good that is more stringent than the prohibition or restriction it applies to the importation of the same good when used; or

(b) re-impose any prohibition or restriction on the importation of a remanufactured good following the removal of the prohibition or restriction.

Table 2-B-1

ANNEX 2-C

EXPORT DUTIES, TAXES OR OTHER CHARGES

1. Article 2.15 (Export Duties, Taxes or Other Charges) shall apply to goods provided for in the items listed in a Party's Section to this Annex only as specified below.

2. With respect to a good provided for in an item listed in Section 1 to this Annex, Malaysia shall not apply any export duties, taxes or other charges in an amount greater than that specified for that item in Section 1 to this Annex.

3. With respect to a good provided for in an item listed in Section 2 to this Annex, Viet Nam shall eliminate any export duties, taxes or other charges in accordance with the following categories, as indicated for each item listed in Section 2 to this Annex:

(a) export duties, taxes or other charges on goods provided for in the items in category A may remain in place for five years but shall not exceed the base rate. Viet Nam shall not apply any export duty, tax or other charge on such goods from January 1 of year 6;

(b) export duties, taxes or other charges on goods provided for in the items in category B may remain in place for seven years but shall not exceed the base rate. Viet Nam shall not apply any export duty, tax or other charge on such goods from January 1 of year 8;

(c) export duties, taxes or other charges on goods provided for in the items in category C shall be eliminated in 11 equal annual stages. Viet Nam shall not apply any export duty, tax or other charge on such goods from January 1 of year 11;

(d) export duties, taxes or other charges on goods provided for in the items in category D may remain in place for 10 years but shall not exceed the base rate. Viet Nam shall not apply any export duty, tax or other charge on such goods from January 1 of year 11;

(e) export duties, taxes or other charges on goods provided for in the items in category E shall be eliminated in 13 equal annual stages. Viet Nam shall not apply any export duty, tax or other charge on such goods from January 1 of year 13;

(f) export duties, taxes or other charges on goods provided for in the items in category F may remain in place for 12 years but shall not exceed the base rate. Viet Nam shall not apply any export duty, tax or other charge on such goods from January 1 of year 13;

(g) export duties, taxes or other charges on goods provided for in the items in category G shall be eliminated in 16 equal annual stages. Viet Nam shall not apply any export duty, tax or other charge on such goods from January 1 of year 16;

(h) export duties, taxes or other charges on goods provided for in the items in category H may remain in place for 15 years but shall not exceed the base rate. Viet Nam shall not apply any export duty, tax or other charge on such goods from January 1 of year 16;

(i) export duties, taxes or other charges on goods provided for in the items in category I shall be reduced to 20 per cent in six equal, annual stages from year 1 to year 6. From January 1 of year 6 until December 31 of year 15, export duties, taxes or other charges on such goods shall not exceed 20 per cent. Viet Nam shall not apply any export duty, tax or other charge on such goods from January 1 of year 16;

(j) export duties, taxes or other charges on goods provided for in the items in category J shall be reduced to 10 per cent in 11 equal, annual stages from year 1 to year 11. From January 1 of year 11 until December 31 of year 15, export duties, taxes or other charges on such goods shall not exceed 10 per cent. Viet Nam shall not apply any export duty, tax or other charge on such goods from January 1 of year 16; and

(k) export duties, taxes or other charges on goods provided for in the items in category K may remain in place but shall not exceed the base rate.

4. For the purposes of paragraph 3 and Section 2 to this Annex, year 1 means the year of entry into force of this Agreement for Viet Nam. Export duties, taxes or other charges on goods provided for in the items in categories C, E, G, I and J shall be initially reduced on the date of entry into force of this Agreement for Viet Nam. From year 2, each annual stage of reduction of export duties, taxes and other charges shall take effect on January 1 of the relevant year.

5. The base rate of export duties, taxes and other charges is indicated for each item in this Annex.

6. Parties that have listed goods in this Annex shall autonomously endeavour to minimise the application and level of their export duties, taxes and other charges.

Section 1: Malaysia

ANNEX 2-D

TARIFF COMMITMENTS

Section A: Tariff Elimination and Reduction

1. The base rate of customs duty and staging category for determining the interim rate of customs duty at each stage of reduction for an item are indicated for that item in each Party's Schedule.

2. Interim staged rates shall be rounded down at least to the nearest tenth of a percentage point or, if the rate of duty is expressed in monetary units, as specified in each Party's Schedule.

3. (a) Except as otherwise provided for in paragraph 4(a), when this Agreement enters into force for a Party in accordance with Article 30.5.1 (Entry into Force), Article 30.5.2 or Article 30.5.3:

(i) the rates of customs duties provided for in any tariff line in that Party's Schedule in any staging category other than "EIF" shall be initially reduced on the date of entry into force of this Agreement for that Party; and

(ii) except as otherwise provided in that Party's Schedule, the second stage of tariff reduction shall take effect on January 1 of the following year, and each subsequent annual stage of tariff reduction for that Party shall take effect on January 1 of each subsequent year.

(b) Except as provided for in paragraph 4(b)(i), when this Agreement enters into force for a Party in accordance with Article 30.5.4 (Entry into Force) and Article 30.5.5:

(i) on the date of entry into force of this Agreement for that Party, that Party shall implement all stages of tariff reduction that it would have implemented up to that date as if this Agreement had entered into force for that Party in accordance with Article 30.5.1 (Entry into Force) Article 30.5.2 or Article 30.5.3; and

(iii) except as otherwise provided in that Party's Schedule, the next annual stage of tariff reduction following those stages implemented in accordance with subparagraph (b)(i) shall take effect on January 1 of the year after the date of entry into force of this Agreement for that Party, and each subsequent annual stage of tariff reduction for that Party shall take effect on January 1 of each subsequent year.

4. (a) A Party for which this Agreement has entered into force in accordance with Article 30.5.1 (Entry into Force), Article 30.5.2 or Article 30.5.3 (original Party) may elect, with respect to a Party for which the Agreement has entered into force in accordance with Article 30.5.4 or Article 30.5.5 (new Party), either to:

(i) apply its Schedule to this Annex as if this Agreement had entered into force for both Parties on the date of entry into force of this Agreement for that new Party; or

(ii) apply its Schedule to this Annex as if this Agreement had entered into force for both Parties on the date of entry into force of this Agreement for that original Party.

(b) If the original Party applies its Schedule as if this Agreement had entered into force for both Parties on the date of entry into force of this Agreement for the new Party pursuant to subparagraph (a)(i), that new Party may elect to apply its Schedule with respect to that original Party, either:

(i) as if this Agreement had entered into force for both Parties on the date of entry into force of this Agreement for that new Party; or

(ii) as if this Agreement had entered into force for both Parties on the date of entry into force of this Agreement for that original Party.

(c) An original Party shall, no later than 12 days after the date of the affirmative determination by the Commission referred to in Article 30.5.5 (Entry into Force) for a signatory, notify that signatory and the other Parties of its election under subparagraph (a) with respect to that signatory. That signatory shall, no later than 24 days after the date of the affirmative determination by the Commission referred to in Article 30.5.5 (Entry into Force) for that signatory, notify the Parties of its election under subparagraph (b) with respect to each original Party that notified its election to apply its Schedule pursuant to subparagraph (a)(i) for that signatory.

(d) If an original Party does not notify an election under subparagraph (a) as provided for in subparagraph (c), that original Party shall, on the date of entry into force of this Agreement for the new Party, apply its Schedule to the new Party as provided for in subparagraph (a)(ii). If a new Party does not notify an election under subparagraph (b) as provided for in subparagraph (c), the new Party shall, on the date of entry into force of this Agreement for that new Party, apply its Schedule to that original Party as provided for in subparagraph (b)(ii).

(e) For greater certainty:

(i) an original Party that applies its Schedule to a new Party as provided for in subparagraph (a)(i) may unilaterally accelerate the elimination of customs duties on an originating good set out in its Schedule to this Annex with respect to the new Party in accordance with Article 2.4.5 (Elimination of Customs Duties); and

(ii) a new Party that applies its Schedule to an original Party as provided for in subparagraph (b)(i) may unilaterally accelerate the elimination of customs duties on an originating good set out in its Schedule to this Annex with respect to the original Party in accordance with Article 2.4.5 (Elimination of Customs Duties).

(f) Notwithstanding any other provision of this Agreement, if, on the date of entry into force of this Agreement for a new Party for which an original Party has elected to apply its Schedule as provided for in subparagraph (a)(i):

(i) that original Party unilaterally accelerates the elimination of customs duties on an originating good of the new Party, that original Party shall not subsequently reverse that acceleration; and

(ii) the new Party unilaterally accelerates the elimination of customs duties on an originating good of that original Party, the new Party shall not subsequently reverse that acceleration.

5. In the event of a discrepancy in a Party's Schedule to this Annex between the staging category specified for an item and any tariff rate specified for that item for a particular year, that Party shall apply the rate required in accordance with the staging category specified for the item.

6. For the purposes of this Annex and a Party's Schedule:

(a) year 1 means:

(i) except as provided for in subparagraphs (a)(ii) and (a)(iii), the year of entry into force of this Agreement for any Party in accordance with Article 30.5.1, Article 30.5.2 and Article 30.5.3 (Entry into Force);

(ii) in the Schedule of an original Party, with respect to goods of a new Party for which that original Party has elected to apply its Schedule as provided for in paragraph 4(a)(i), the year of entry into force of this Agreement for that new Party; and

(iii) in the Schedule of a new Party, with respect to goods of an original Party for which that new Party has elected to apply its Schedule as provided for in paragraph 4(b)(i), the year of entry into force of this Agreement for the new Party; but

(iv) notwithstanding subparagraphs (a)(ii) and (a)(iii):

A) for the purposes of any tariff-rate quota or safeguard measure set out in the Schedule of a Party and applicable to originating goods of all Parties, year 1 means the year this Agreement enters into force for any Party in accordance with Article 30.5.1 (Entry into Force); and

B) for the purposes of any tariff-rate quota or safeguard measure set out in the Schedule of a Party and applicable to originating goods of more than one Party, but not all Parties, year 1 shall have the meaning set out in the Schedule of that Party;

(b) year 2 means the year after year 1; year 3 means the year after year 2, year 4 means the year after year 3, and so on; and

(c) year means a calendar year beginning on January 1 and ending on December 31, except as otherwise provided in a Party's Schedule.

7. For tariff lines where a safeguard is applicable as identified in a Party's Schedule to this Annex, the modalities of that safeguard as it applies to originating goods are specified in Appendix B to that Party's Schedule.

Section B: Tariff Differentials

8. Except as otherwise provided in a Party's Schedule to this Annex, if an importing Party applies different preferential tariff treatment to other Parties for the same originating good at the time a claim for preferential tariff treatment is made in accordance with the importing Party's Schedule to this Annex, that importing Party shall apply the rate of customs duty for the originating good of the Party where the last production process, other than a minimal operation, occurred.

9. For the purposes of paragraph 8, a minimal operation is:

(a) an operation to ensure the preservation of a good in good condition for the purposes of transport and storage;

(b) packaging, re-packaging, breaking up of consignments or putting up a good for retail sale, including placing a good in bottles, cans, flasks, bags, cases or boxes;

(c) mere dilution with water or another substance that does not materially alter the characteristics of the good;

(d) collection of goods intended to form sets, assortments, kits or composite goods; and

(e) any combination of operations referred to in subparagraphs (a) through (d).

10. Notwithstanding paragraph 8 and any applicable rules and conditions set out in a Party's Schedule to this Annex, the importing Party shall allow an importer to make a claim for preferential tariff treatment at either:

(a) the highest rate of customs duty applicable to an originating good from any of the Parties; or

(b) the highest rate of customs duty applicable to an originating good from any Party where a production process occurred.


Party-specific Annexes to the Chapter

ANNEX 2-D

TARIFF SCHEDULE OF AUSTRALIA GENERAL NOTES

1. The provisions of this Schedule are generally expressed in terms of the corresponding items in Schedule 3 to the Customs Tariff Act 1995 (Cth) (Tariff Act), and the interpretation of the provisions of this Schedule, including the product coverage of subheadings of this Schedule, shall be governed by the Tariff Act. To the extent that provisions of this Schedule are identical to the corresponding provisions of the Tariff Act, the provisions of this Schedule shall have the same meaning as the corresponding provisions of the Tariff Act.

2. The base rates of duty set out in this Schedule reflect Australia's Most- Favoured-Nation (MFN) rates of duty in effect on January 1, 2010.

3. The following staging categories shall apply to the elimination or reduction of customs duties by Australia pursuant to Article 2.4.2 (Elimination of Customs Duties):

(a) customs duties on originating goods provided for in the items in staging category EIF shall be eliminated entirely, and these goods shall be duty-free on the date of entry into force of this Agreement for Australia;

(b) customs duties on originating goods provided for in the items in staging category AU3-A shall be immediately reduced to two per cent and shall then be reduced to one per cent on January 1 of year 2, and shall be eliminated and these goods shall be duty-free from January 1 of Year 3;

(c) customs duties on originating goods provided for in the items in staging category AU3-B shall be immediately reduced to five per cent and shall remain at that level for year 1 through December 31 of year 2, and shall be eliminated and these goods shall be duty- free from January 1 of year 3;

(d) customs duties on originating goods provided for in the items in staging category AU3-C shall remain at the base rate and at that level for year 1 through December 31 of year 2. The customs duties on these goods shall be eliminated and these goods shall be duty-free from January 1 of year 3;

(e) customs duties on originating goods provided for in the items in staging category B4 shall be eliminated in four annual stages and these goods shall be duty-free from January 1 of year 4;

(f) customs duties on originating goods provided for in the items in staging category AU4-A shall be reduced to five per cent and shall remain at that level for year 1 through December 31 of year 3. The customs duties on these goods shall be eliminated and these goods shall be duty-free from January 1 of year 4;

(g) customs duties on originating goods provided for in the items in staging category AU4-B shall remain at the base rate until December 31 of year 3. The customs duties on these goods shall be eliminated and these goods shall be duty-free from January 1 of year 4; and

(h) the ad valorem component of the customs duties on originating goods provided for in the items in staging category AU-R1 shall be eliminated on the date of entry into force of this Agreement for Australia. The non-ad valorem component of the customs duty on these goods shall be maintained.

4. The annual stages referred to in paragraph 3 for the elimination or reduction of customs duties shall be equal, annual stages, except:

(a) as provided in paragraphs 3(b)(i), 4(a)(ii) and 4(b)(ii) in Section A of this Annex; or

(b) as otherwise provided in paragraph 3.

5.

(a) Upon request from Japan, Australia and Japan shall consult to consider Australia's commitments to Japan regarding treatment of originating goods related to the application of customs duties, tariff rate quotas and safeguards in this Schedule no sooner than seven years after the date of entry into force of this Agreement for Australia and Japan, with a view to increasing market access.

(b) Following completion of applicable legal procedures by Australia and another State or customs territory necessary for entry into force of an international agreement, or an amendment thereto, granting preferential market access by Australia to that other State or customs territory, and on request of Japan, Australia and Japan shall consult to consider Australia's commitments to Japan regarding treatment of originating goods related to the application of customs duties, tariff rate quotas and safeguards in this Schedule, with a view to providing to the originating goods treatment equivalent to that provided to goods classified in the same tariff lines under the international agreement. Australia and Japan shall consult no later than one month after the date of the request, unless Australia and Japan agree otherwise.

(c) For greater certainty, nothing in this paragraph shall be construed to affect the rights or obligations of Australia under any other provision of this Agreement.


TARIFF SCHEDULE OF AUSTRALIA (HS2012)

ANNEX 2-D

TARIFF SCHEDULE OF BRUNEI DARUSSALAM GENERAL NOTES

1. The provisions of this Schedule are generally expressed in terms of the corresponding items in Customs Import Duties Order 2007, and the interpretation of the provisions of this Schedule, including the product coverage of subheadings of this Schedule, shall be governed by the General Notes, Section Notes and Chapter Notes of Brunei Darussalam's Customs Import Duties Order 2007. To the extent that provisions of this Schedule are identical to the corresponding provisions of the the Customs Import Duties Order 2007, the provisions of this Schedule shall have the same meaning as the corresponding provisions of the the Customs Import Duties Order 2007.

2. The base rates of duty set out in this Schedule reflect Brunei Darussalam's Most-Favoured-Nation (MFN) rates of duty in effect on January 1, 2010.

3. In this Schedule, rates of duty expressed in monetary units shall be rounded down to the nearest hundredth of a Brunei dollar.

4. The following staging categories shall apply to the elimination or reduction of customs duties by Brunei Darussalam pursuant to Article 2.4.2 (Elimination of Customs Duties):

(a) customs duties on originating goods provided for in the items in staging category EIF shall be eliminated entirely, and these goods shall be duty-free from the date of entry into force of this Agreement for Brunei Darussalam;

(b) customs duties on originating goods provided for in the items in staging category BD3 shall remain at the base rate until December 31 of year 2. The customs duties on these goods shall be eliminated and these goods shall be duty-free from January 1 of year 3;

(c) customs duties on originating goods provided for in the items in staging category BD6 shall remain at the base rate until December 31 of year 3. The customs duties shall be reduced to 15 per cent ad valorem on January 1 of year 4 and the customs duties on these goods shall be eliminated and these goods shall be duty-free from January 1 of year 6;

(d) customs duties on originating goods provided for in the items in staging category BD7-A shall remain at the base rate until December 31 of year 6. The customs duties on these goods shall be eliminated and these goods shall be duty-free from January 1 of year 7;

(e) customs duties on originating goods provided for in the items in staging category BD7-B shall remain at the base rate until December 31 of year 3 and be reduced to 10 per cent ad valorem on January 1 of year 4. The customs duties on these goods shall be eliminated and these goods shall be duty-free from January 1 of year 7;

(f) customs duties on originating goods provided for in the items in staging category BD7-C shall remain at the base rate until December 31 of year 3. The customs duties on these goods shall be 15 per cent ad valorem from January 1 of year 4; 10 per cent ad valorem from January 1 of year 6; and the customs duties on these goods shall be eliminated and these goods shall be duty-free from January 1 of year 7;

(g) customs duties on originating goods provided for in the items in staging category BD7-D shall remain at the base rate until December 31 of year 5 and be reduced to five cents per kilogramme on January 1 of year 6. The customs duties on these goods shall be eliminated and these goods shall be duty-free from January 1 of year 7;

(h) customs duties on originating goods provided for in the items in staging category BD7-E shall remain at the base rate until December 31 of year 5 and be reduced to ten cents per kilogramme from January 1 of year 6. The customs duties on these goods shall be eliminated and these goods shall be duty-free from January 1 of year 7;

(i) customs duties on originating goods provided for in the items in staging category BD7-F shall remain at the base rate until December 31 of year 5 and be reduced to ten cents per decalitre on January 1 of year 6. The customs duties on these goods shall be eliminated and these goods shall be duty-free from January 1 of year 7;

(j) customs duties on originating goods provided for in the items in staging category BD7-G shall remain at the base rate until December 31 of year 5 and be reduced to twenty cents per decalitre on January 1 of year 6. The customs duties on these goods shall be eliminated and these goods shall be duty-free from January 1 of year 7;

(k) customs duties on originating goods provided for in the items in staging category BD11 shall remain at the base rate until December 31 of year 10. The customs duties on these goods shall be eliminated and these goods shall be duty-free from January 1 of year 11; and

(l) customs duties on originating goods provided for in the items in staging category BD-A shall remain duty free on the date of entry into force of this Agreement for Brunei Darussalam. The import licensing and import restrictions on these goods shall remain.

5. The annual stages referred to in paragraph 4 for the elimination or reduction of customs duties shall be equal, annual stages, except:

(a) as provided in paragraphs 3(b)(i), 4(a)(ii) and 4(b)(ii) in Section A of this Annex; or

(b) as otherwise provided in paragraph 4.


TARIFF SCHEDULE OF BRUNEI DARUSSALAM (HS2012)

ANNEX 2-D

TARIFF SCHEDULE OF CANADA GENERAL NOTES

1. The provisions of this Schedule are generally expressed in terms of Canada's Customs Tariff, and the interpretation of the provisions of this Schedule, including the product coverage of subheadings of this Schedule, shall be governed by the General Notes, Section Notes and Chapter Notes of Canada's Customs Tariff. To the extent that provisions of this Schedule are identical to the corresponding provisions of Canada's Customs Tariff, the provisions of this Schedule shall have the same meaning as the corresponding provisions of Canada's Customs Tariff.

2. The base rates of duty set out in this Schedule reflect Canada's MostFavoured-Nation (MFN) rates of duty in effect on January 1, 2010.

3. In this Schedule, rates of duty expressed in monetary units shall be rounded down to the nearest 0.0001 of a Canadian dollar.

4. The following staging categories shall apply to the elimination or reduction of customs duties by Canada pursuant to Article 2.4.2 (Elimination of Customs Duties):

(a) customs duties on originating goods provided for in the items in staging category EIF shall be eliminated entirely, and these goods shall be duty-free on the date of entry into force of this Agreement for Canada;

(b) customs duties on originating goods provided for in the items in staging category B4 shall be eliminated in four annual stages, and these goods shall be duty-free effective January 1 of year 4;

(c) customs duties on originating goods provided for in the items in staging category B6 shall be eliminated in six annual stages, and these goods shall be duty-free effective January 1 of year 6;

(d) customs duties on originating goods provided for in the items in staging category B7 shall be eliminated in seven annual stages, and these goods shall be duty-free effective January 1 of year 7;

(e) customs duties on originating goods provided for in the items in staging category B11 shall be eliminated in 11 annual stages, and these goods shall be duty-free effective January 1 of year 11;

(f) customs duties on originating goods provided for in the items in staging category CA1 shall be maintained at the base rate during year 1 through year 8, and shall be eliminated in four annual stages beginning in year 9, and these goods shall be duty-free effective January 1 of year 12;

(g) customs duties on originating goods provided for in the items in staging category CA2 shall be reduced to one-quarter of the base rate on the date of entry into force in year 1, shall be maintained at that rate through year 11, and shall be eliminated and these goods shall be duty-free effective January 1 of year 12;

(h) customs duties on originating goods provided for in the items in staging category CA3 shall be reduced to a rate of duty of 5.5 per cent on the date of entry into force in year 1, shall be reduced to a rate of duty of 5.0 per cent on January 1 of year 2, shall be reduced to a rate of duty of 2.5 per cent on January 1 of year 3, shall be reduced to a rate of duty of 2.0 per cent on January 1 of year 4, and shall be eliminated and these goods shall be duty-free effective January 1 of year 5; and

(i) customs duties on originating goods provided for in the items in staging category TRQ shall be governed by the terms of the TRQ applicable to that tariff item, as outlined in Appendix A (Tariff Rate Quotas of Canada) to Canada's Schedule to Annex 2-D.

5. The annual stages referred to in paragraph 4 for the elimination or reduction of customs duties shall be equal, annual stages, except:

(a) as provided in paragraphs 3(b)(i), 4(a)(ii) and 4(b)(ii) in Section A of this Annex; or

(b) as otherwise provided in paragraph 4.

6. (a) Upon request from Japan, Canada and Japan shall consult to consider Canada's commitments to Japan regarding the treatment of originating goods related to the application of customs duties, tariff rate quotas and safeguards in this Schedule no sooner than seven years after the date of entry into force of this Agreement for Canada and Japan, with a view to increasing market access.

(b) Following completion of applicable legal procedures by Canada and another State or customs territory necessary for entry into force of an international agreement, or an amendment thereto, granting preferential market access by Canada to that other State or customs territory, and on request of Japan, Canada and Japan shall consult to consider Canada's commitments to Japan regarding treatment of originating goods related to the application of customs duties, tariff rate quotas and safeguards in this Schedule, with a view to providing to the originating goods treatment equivalent to that provided to goods classified in the same tariff lines under the international agreement. Canada and Japan shall consult no later than one month after the date of the request, unless Canada and Japan agree otherwise.

(c) For greater certainty, nothing in this paragraph shall be construed to affect the rights or obligations of Canada under any other provision of this Agreement.


TARIFF SCHEDULE OF CANADA (HS2012)

APPENDIX D

BETWEEN JAPAN AND CANADA ON MOTOR VEHICLE TRADE

Article 1

1. For the purposes of this Appendix:

Appendix Party means either Japan or Canada, as the case may be; motor vehicle means any good classified under heading 87.03; and

originating motor vehicle means any motor vehicle qualifying as originating under Chapter 3 (Rules of Origin and Origin Procedures).

2. No Party other than an Appendix Party shall have recourse to dispute settlement under Chapter 28 (Dispute Settlement) for any matter arising under this Appendix or to dispute settlement under Article 4 for any matter arising under this Agreement. No Appendix Party shall have recourse to dispute settlement under Chapter 28 (Dispute Settlement) for nullification or impairment within the meaning of Article 28.3.1(c) (Scope) for any matter arising under Article 3 or Article 4 of this Appendix.

Article 2

An Appendix Party shall accord to the other Appendix Party treatment no less favourable than that accorded to a Party other than the other Appendix Party with respect to technical regulations, standards or conformity assessment procedures on motor vehicles that are adopted or applied in accordance with a bilateral agreement provided for in this Agreement.

Article 3

An Appendix Party may apply a transitional safeguard measure on originating motor vehicles from the other Appendix Party classified under heading 87.03, during the transition period only, in accordance with the provisions set out in Chapter 6 (Trade Remedies), with the following procedural modifications:

(a) In lieu of the definition of transition period provided for in Article 6.1 (Definitions), the following definition shall apply:

transition period means the period beginning on the date of entry into force of this Agreement with respect to Japan and Canada and ending on the date that is 12 years after the end of the period of the staged tariff elimination for a particular good.

(b) In lieu of Article 6.4.2 (Standards for a Transitional Safeguard Measure), the following shall apply:

Neither Appendix Party shall apply a transitional safeguard measure for a period exceeding three years, except that the period may be extended by up to two years if the competent authority of the Appendix Party that applies the measure determines, in conformity with the procedures set out in Article 6.5 (Investigation Procedures and Transparency Requirements), that the transitional safeguard measure continues to be necessary to prevent or remedy serious injury and to facilitate adjustment.

(c) Paragraphs 4 and 6 of Article 6.4 (Standards for a Transitional Safeguard Measure) shall not apply.

(d) In lieu of paragraphs 1 and 2 of Article 6.7 (Compensation), the following shall apply:

(i) An Appendix Party applying a transitional safeguard measure shall consult with the other Appendix Party in order to mutually agree on appropriate trade liberalising compensation in the form of concessions that have substantially equivalent trade effects or equivalent to the value of the additional duties expected to result from the transitional safeguard measure. The Appendix Party shall provide an opportunity for those consultations no later than 30 days after the application of the transitional safeguard measure;

(ii) If the consultations under subparagraph (d)(i) do not result in an agreement on trade liberalising compensation within 30 days after the consultations begin, the Appendix Party against whose good the transitional safeguard measure is applied may suspend the application of substantially equivalent concessions to the trade of the Appendix Party applying the transitional safeguard measure; and

(iii) The right of suspension referred to in subparagraph (d)(ii) shall not be exercised for the first 24 months during which a transitional safeguard measure is in effect, provided that the transitional safeguard measure conforms to the provisions of this Agreement.

Article 4

1. For the purposes of this Article, the definitions set out in Article 28.1 (Definitions) shall apply, mutatis mutandis.1

2. With respect to any matter described in Article 28.3 (Scope) that relates to motor vehicles, an Appendix Party may initiate the dispute settlement procedures set out in this Article in lieu of the procedures provided for in Article 28.4 (Choice of Forum), Article 28.5 (Consultations), Article 28.6 (Good Offices, Conciliation and Mediation), Article 28.7 (Establishment of a Panel), Article 28.8 (Terms of Reference), Article 28.9 (Composition of Panels), Article 28.10 (Qualifications of Panellists), Article 28.11 (Roster of Panel Chairs and Party Specific Lists), Article 28.12 (Function of Panels), Article 28.13 (Rules of Procedure for Panels), Article 28.14 (Third Party Participation), Article 28.15 (Role of Experts), Article 28.16 (Suspension or Termination of Proceedings), Article 28.17 (Initial Report), Article 28.18 (Final Report), Article 28.19 (Implementation of Final Report), Article 28.20 (Non-Implementation – Compensation and Suspension of Benefits) and Article 28.21 (Compliance Review).

3.

(a) An Appendix Party may request consultations with the other Appendix Party with respect to any matter described in paragraph 2. The Appendix Party making the request for consultations shall do so in writing, and shall set out the reasons for the request, including identification of the actual or proposed measure or other matter at issue and an indication of the legal basis for the complaint. The requesting Appendix Party shall circulate the request concurrently to the other Parties through the overall contact points designated under Article 27.5.1 (Contact Points).

(b) The Appendix Party to which a request for consultations is made shall, unless the Appendix Parties agree otherwise, reply in writing to the request no later than seven days after the date of its receipt of the request.3 That Appendix Party shall circulate its reply concurrently to the other Parties through the overall contact points and enter into consultations in good faith.

(c) Unless the Appendix Parties agree otherwise, they shall enter into consultations no later than 15 days after the date of receipt of the request.

(d) Unless the Appendix Parties agree otherwise, paragraphs 5 through 8 of Article 28.5 (Consultations) shall apply, mutatis mutandis,4to the consultations under this paragraph.

4.

(a) An Appendix Party that requested consultations under paragraph 3(a) may request, by means of a written notice addressed to the other Appendix Party, the establishment of a panel if the Appendix Parties fail to resolve the matter within a period of 30 days after the date of receipt of the request for consultations under paragraph 3(a).

(b) The complaining Appendix Party shall circulate the request concurrently to the other Parties through the overall contact points designated under Article 27.5.1 (Contact Points).

(c) Paragraphs 3, 4 and 7 of Article 28.7 (Establishment of a Panel) shall apply, mutatis mutandis, to the establishment of a panel. Unless the Appendix Parties agree otherwise, the panel shall be composed in a manner consistent with this Article and, subject to the time frames set out in paragraph 6, the Rules of Procedure.

5.

(a) Unless the Appendix Parties agree otherwise no later than 15 days after the date of delivery of the request for the establishment of a panel, the terms of reference shall be to:

(i) examine, in the light of the relevant provisions of this Agreement, the matter referred to in the request for the establishment of a panel under paragraph 4(a); and

(ii) make findings and determinations, and any jointly requested recommendations, together with its reasons therefor, as provided for in Article 28.17.4 (Initial Report) as applied pursuant to paragraph 8.

(b) If, in its request for the establishment of a panel, the complaining Appendix Party claims that a measure nullifies or impairs benefits within the meaning of Article 28.3.1(c) (Scope), the terms of reference shall so indicate.

6.

(a) A panel shall be composed of three members.

(b) Unless the Appendix Parties agree otherwise, they shall apply the following procedures to compose a panel:

(i) Within a period of 15 days after the date of delivery of the request for the establishment of a panel under paragraph 4(a), the complaining Appendix Party, on the one hand, and the responding Appendix Party, on the other, shall each appoint a panellist and notify each other of those appointments.

(ii) If the complaining Appendix Party fails to appoint a panellist within the period specified in subparagraph (b)(i), the dispute settlement proceedings shall lapse at the end of that period.

(iii) If the responding Appendix Party fails to appoint a panellist within the period specified in subparagraph (b)(i), the complaining Appendix Party shall select the panellist not yet appointed:

(A) from the responding Appendix Party's list established under Article 28.11.9 (Roster of Panel Chairs and Party Specific Lists);

(B) if the responding Appendix Party has not established a list under Article 28.11.9 (Roster of Panel Chairs and Party Specific Lists), from the roster of panel chairs established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists); or

(C) if the responding Appendix Party has not established a list under Article 28.11.9 (Roster of Panel Chairs and Party Specific Lists) and no roster of panel chairs has been established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists), by random selection from a list of three candidates, who are not nationals of the complaining Appendix Party, nominated by the complaining Appendix Party,

no later than 20 days after the date of delivery of the request for the establishment of a panel under paragraph 4(a).

(iv) For appointment of the third panellist, who shall serve as chair:

(A) the Appendix Parties shall endeavour to agree on the appointment of a chair;

(B) if the Appendix Parties fail to appoint a chair under subparagraph (b)(iv)(A) within a period of 15 days after the date of delivery of the request for the establishment of the panel under paragraph 4(a), the Appendix Parties shall select the chair by random selection from the roster established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists) within a period of 20 days after the date of delivery of the request for the establishment of the panel; or

(C) if a roster has not been established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists), and subparagraphs (b)(iv)(A) and (B) cannot apply, each Appendix Party may nominate up to three candidates. The chair shall be randomly selected from those candidates that are nominated within a period of 20 days after the date of delivery of the request for the establishment of a panel under paragraph 4(a).

(D) The chair shall not be a national of either Appendix Party and any nationals of the Appendix Parties appointed to the roster established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists) shall be excluded from a selection process under subparagraph (b)(iv).

(v) If a panellist selected under subparagraph (b)(iii) or (iv)(B) is unable to serve on the panel, the Appendix Parties shall meet no later than five days after the date of learning that the panellist is unavailable to select another panellist from among the remaining members of the list (in the case of subparagraph (b)(iii)) or the roster (in the case of subparagraph (b)(iv)(B)).

(vi) If a panellist appointed under this paragraph resigns or becomes unable to serve on the panel, either during the course of proceeding or when the panel is reconvened under paragraph 13 or Article 28.21 (Compliance Review) as applied under paragraph 12, 17 or 18, a replacement panellist shall be appointed within 12 days in accordance with the selection procedures prescribed in this subparagraph for the appointment of the original panellist. The replacement shall have all the powers and duties of the original panellist. The work of the panel shall be suspended pending the appointment of the replacement panellist, and all time frames set out in this Article and in the Rules of Procedure shall be extended by the amount of time that the work was suspended.

(vii) Paragraphs 4, 5 and 10 of Article 28.9 (Composition of Panels) shall apply, mutatis mutandis,to the selection procedures.

7. All panellists shall meet the requirements set out in Article 28.10.1 (Qualifications of Panellists). An individual shall not serve as a panellist for a dispute in which that person has participated under Article 28.6 (Good Offices, Conciliation, and Mediation) as applied pursuant to paragraph 8.

8. Unless the Appendix Parties agree otherwise, Article 28.4 (Choice of Forum), Article 28.6 (Good Offices, Conciliation and Mediation), Article 28.12 (Function of Panels), Article 28.15 (Role of Experts), Article 28.16 (Suspension or Termination of Proceedings), Article 28.17 (Initial Report) and Article 28.18 (Final Report) shall apply, mutatis mutandis,6to panel proceedings under this Article, except that:

(a) with respect to Article 28.17.3 (Initial Report), the panel shall present an initial report to the Appendix Parties no later than 100 days after the date of the appointment of the last panellist;

(b) with respect to Article 28.17.4 (Initial Report), the panel shall also make a determination as to whether the non-conformity or the nullification or impairment, if any, has materially affected the sale, offering for sale, purchase, transportation, distribution or use of originating motor vehicles from the complaining Appendix Party;

(c) with respect to Article 28.17.7 (Initial Report), an Appendix Party may submit written comments to the panel on its initial report no later than 10 days after the presentation of the initial report or within another period as the Appendix Parties may agree; and

(d) with respect to Article 28.18.1 (Final Report), the panel shall present a final report to the Appendix Parties, including any separate opinions on matters not unanimously agreed, no later than 20 days after presentation of the initial report. After taking any steps to protect confidential information, and no later than 15 days after the presentation of the final report, the Appendix Parties shall release the final report to the public.

9. Unless the Appendix Parties agree otherwise, paragraphs 1 and 2 of Article 28.19 (Implementation of Final Report) shall apply, mutatis mutandis, to the implementation of the final report.

10.

(a) Unless the Appendix Parties agree otherwise, if in its final report the panel determines that:

(i) (A) the measure at issue is inconsistent with an Appendix Party's obligations in this Agreement;

(B) an Appendix Party has otherwise failed to carry out its obligations in this Agreement; or

(C) the measure at issue is causing nullification or impairment within the meaning of Article 28.3.1(c) (Scope);

and

(ii) the non-conformity or the nullification or impairment that the panel has determined to exist has materially affected the sale, offering for sale, purchase, transportation, distribution or use of originating motor vehicles from the complaining Appendix Party,

the complaining Appendix Party may suspend the application to the responding Appendix Party of benefits in accordance with this paragraph, paragraph 11 and paragraphs 13 through 16.

(b) Unless the Appendix Parties agree otherwise, the responding Appendix Party shall have a reasonable period of time in which to eliminate the non-conformity or nullification or impairment if it is not practicable to do so immediately.

(c) Unless the Appendix Parties agree otherwise, the reasonable period of time shall be:

(i) six months from the presentation of the final report under Article 28.18.1 (Final Report) as applied pursuant to paragraph 8; or

(ii) if elimination of the non-conformity or nullification or impairment requires amendment of laws or regulations adopted by the Diet of Japan or the Parliament of Canada, or the legislative body of local subdivision, 12 months from the presentation of the final report.

11.

(a) The responding Appendix Party shall, if requested by the complaining Appendix Party, enter into negotiations with the complaining Appendix Party no later than 15 days after receipt of that request, with a view to developing mutually acceptable compensation, if:

(i) the responding Appendix Party has notified the complaining Appendix Party that it does not intend to eliminate the non conformity or the nullification or impairment; or

(ii) following the expiry of the reasonable period of time set out in paragraph 10(c), there is disagreement between the Appendix Parties as to whether the responding Appendix Party has eliminated the non-conformity or the nullification or impairment.

(b) A complaining Appendix Party may suspend benefits in accordance with subparagraph (c) if the Appendix Parties have:

(i) been unable to agree on compensation within a period of 30 days after the period for developing compensation has begun in accordance with subparagraph (a); or

(ii) agreed on compensation but the complaining Appendix Party considers that the responding Appendix Party has failed to observe the terms of the agreement.

(c) A complaining Appendix Party may, at any time after the conditions set out in subparagraph (b) are met in relation to the complaining Appendix Party, provide a written notice to the responding Appendix Party that it intends to suspend benefits under paragraph 14 or 15. The notice shall specify the level of benefits that the complaining Appendix Party proposes to suspend. The complaining Appendix Party may begin suspending benefits in accordance with paragraph 14 or 15 after the date on which it provides the notice.

(d) Compensation and suspension of benefits shall be temporary measures. None of these measures is preferred to full implementation through elimination of the non-conformity or the nullification or impairment. Compensation and suspension of benefits shall only be applied until the responding Appendix Party has eliminated the non-conformity or the nullification or impairment, or until a mutually satisfactory solution is reached.

12. Unless the Appendix Parties agree otherwise, if in its final report the panel determines that the non-conformity or the nullification or impairment that the panel has determined to exist under paragraph 10(a)(i) has not materially affected the sale, offering for sale, purchase, transportation, distribution or use of originating motor vehicles from the complaining Appendix Party, the procedures provided for in paragraphs 3 through 7 of Article 28.19 (Implementation of Final Report), Article 28.20 (Non-Implementation – Compensation and Suspension of Benefits) and Article 28.21 (Compliance Review) shall apply, mutatis mutandis.

13. (a) If the responding Appendix Party considers that:

(i) the level of benefits proposed to be suspended under paragraph 15 is manifestly excessive; or

(ii) it has eliminated the non-conformity or the nullification or impairment that the panel has determined to exist,

it may, no later than 30 days after the date of delivery of the written notice provided by the complaining Appendix Party under paragraph 11(c), request that the panel be reconvened to consider the matter. The responding Appendix Party shall deliver its request in writing to the complaining Appendix Party. The panel shall reconvene as soon as possible after the date of delivery of the request and shall present its determination to the Appendix Parties no later than 90 days after delivery of the request.

(b) If the panel determines that the level of benefits the complaining Appendix Party proposes to suspend under paragraph 15 is manifestly excessive, it shall determine the level of benefits that the complaining Appendix Party may suspend. The panel shall determine:

(i) the level of benefits of equivalent effect, as set out in Article 28.20.5 (Non-Implementation – Compensation and Suspension of Benefits); and

(ii) if the prevailing most-favoured-nation applied rate of customs duty imposed by the complaining Appendix Party on motor vehicles classified under heading 87.03 is zero per cent, the level of benefits equivalent to the effect of application by the responding Appendix Party of its prevailing most-favoured-nation applied rate of customs duty on motor vehicles classified under heading 87.03.

14. Unless the panel has determined that the responding Appendix Party has eliminated the non-conformity or the nullification or impairment, 30 days after the later of:

(a) the date on which the complaining Appendix Party provides the notice under paragraph 11(c); or

(b) if the responding Appendix Party requests that the panel be reconvened to consider the matter under paragraph 13(a)(ii), the date that the panel issues its determination under paragraph 13,

the complaining Appendix Party may increase the rate of customs duty on originating motor vehicles from the responding Appendix Party classified under heading 87.03 to a level not to exceed the prevailing most-favoured nation applied rate of customs duty on those motor vehicles, for a period of up to 100 days following the 30-day period.

15. Unless the panel has determined that the responding Appendix Party has eliminated the non-conformity or the nullification or impairment:

(a) if the panel determines the level of benefits under paragraph 13(b), 30 days after the later of the date on which the complaining Appendix Party provides the notice under paragraph 11(c) or the date that the panel issues its determination under paragraph 13, the complaining Appendix Party may:

(i) increase the rate of customs duty on originating motor vehicles from the responding Appendix Party classified under heading 87.03 up to the level the panel has determined under paragraph 13(b)(i); or

(ii) if the prevailing most-favoured-nation applied rate of customs duty imposed by the complaining Appendix Party on motor vehicles under heading 87.03 is zero per cent, suspend the application to the responding Appendix Party of benefits with respect to originating goods from the responding Appendix Party:

(A) up to the level the panel has determined under paragraph 13(b)(i); and

(B) up to the level the panel has determined under paragraph 13(b)(ii) for a period of up to 100 days following the 30-day period,

and

(b) if the responding Appendix Party does not request that the panel be reconvened to consider the matter under paragraph 13(a)(i) or the panel has not determined the level under paragraph 13(b), after the 30-day period, the complaining Appendix Party may suspend the application to the responding Appendix Party of benefits up to the level the complaining Appendix Party has proposed to suspend under paragraph 11(c),

provided that the increased rate of customs duty applied to any goods under this paragraph shall not exceed the prevailing most-favoured-nation applied rate of customs duty on such goods.

16. As long as the complaining Appendix Party is applying the increased rate of customs duty under paragraph 14, it shall not suspend the application to the responding Appendix Party of benefits under paragraph 15.

17. Unless the Appendix Parties agree otherwise, Article 28.21 (Compliance Review) shall apply, mutatis mutandis,8to compliance review.

18. If a final report is presented after the 10-year period beginning on the date of entry into force of this Agreement, the procedures provided for in paragraphs 3 through 7 of Article 28.19 (Implementation of Final Report), Article 28.20 (Non Implementation – Compensation and Suspension of Benefits) and Article 28.21 (Compliance Review) shall apply, mutatis mutandis, in lieu of the procedures provided for in paragraphs 10 through 17.

Article 5

1. The Appendix Parties hereby establish a special bilateral Committee on Motor Vehicles (Committee), composed of representatives of the relevant authorities of each Appendix Party. The Committee shall:

(a) monitor implementation of the obligations in this Agreement with respect to motor vehicles;

(b) consult to resolve issues affecting trade and investment between the Appendix Parties that an Appendix Party raises with respect to the development and implementation of measures relating to motor vehicles and motor vehicle parts;

(c) facilitate increased cooperation with respect to emerging issues, including the manufacture, importation, sale and operation of motor vehicles using alternative fuels, and cooperation between the Appendix Parties with respect to issues concerning other markets;

(d) monitor bilateral, regional and global market developments and trends in trade, investment, production, sales and distribution with respect to motor vehicles and motor vehicle parts;

(e) provide opportunities for input from interested persons of the Appendix Parties on matters relevant to the Committee's work, as the Appendix Parties may agree; and

(f) address other issues, if the Appendix Parties agree.

2. The Committee shall meet at mutually agreed times. Meetings shall take place in such locations and through such means as the Appendix Parties decide.


ANNEX 2-D

TARIFF SCHEDULE OF CHILE GENERAL NOTES

1. The provisions of this Schedule are generally expressed in terms of the Customs Tariff Schedule of Chile (Arancel Aduanero Chileno), HS 2012 (SA 2012), and the interpretation of the provisions of this Schedule, including the product coverage of subheadings of this Schedule, shall be governed by the General Notes, Section Notes and Chapter Notes of the Customs Tariff Schedule of Chile (Arancel Aduanero Chileno). To the extent that provisions of this Schedule are identical to the corresponding provisions of the Customs Tariff Schedule of Chile (Arancel Aduanero Chileno), the provisions of this Schedule shall have the same meaning as the corresponding provisions of the Customs Tariff Schedule of Chile (Arancel Aduanero Chileno).

2. The base rates of duty set out in this Schedule reflect Chile's Most Favoured-Nation (MFN) rates of duty in effect on January 1, 2010.

3. In this Schedule, rates of duty expressed in monetary units shall be rounded to the nearest hundredth of a Chilean Peso.

4. The following staging categories shall apply to the elimination or reduction of customs duties by Chile pursuant to Article 2.4.2 (Elimination of Customs Duties):

(a) customs duties on originating goods provided for in the items in staging category EIF shall be eliminated entirely, and these goods shall be duty-free on the date of entry into force of this Agreement for Chile;

(b) customs duties on originating goods provided for in the items in staging category B4 shall be eliminated in four annual stages, and these goods shall be duty-free effective January 1 of year 4;

(c) customs duties on originating goods provided for in the items in staging category B8 shall be eliminated in eight annual stages, and these goods shall be duty-free effective January 1 of year 8;

(d) customs duties on originating goods provided for in the items in staging category CL-AU FTA-Wheat shall be as established for the same items in the Chile-Australia Free Trade Agreement, done at Canberra, July 30, 2008;

(e) customs duties on originating goods provided for in the items in staging category CL-AU FTA-Sugar shall be as established for the same items in the Chile-Australia Free Trade Agreement, done at Canberra, July 30, 2008;

(f) customs duties on originating goods provided for in the items in staging category CL-P4-Wheat shall be eliminated subject to the conditions for the same items in the Trans-Pacific Strategic Economic Partnership Agreement (P4), done at Wellington, July 18, 2005;

(g) customs duties on originating goods provided for in the items in staging category CL-P4-Sugar shall be eliminated subject to the conditions for the same items in the Trans-Pacific Strategic Economic Partnership Agreement (P4), done at Wellington, July 18, 2005;

(h) customs duties on originating goods provided for in the items in staging category CL-CA FTA-Wheat shall be as established for the same items in the Canada-Chile Free Trade Agreement, done at Santiago, December 5, 1996;

(i) customs duties on originating goods provided for in the items in staging category CL-CA FTA-Sugar shall be as established for the same items in the Canada-Chile Free Trade Agreement, done at Santiago, December 5, 1996;

(j) customs duties on originating goods provided for in the items in staging category CL-JP SEP-Wheat shall be as established for the same items in the Agreement between Japan and the Republic of Chile for a Strategic Economic Partnership, done at Tokyo, March, 27, 2007;

(k) customs duties on originating goods provided for in the items in staging category CL-JP SEP-Sugar shall be as established for the same items in the Agreement between Japan and the Republic of Chile for a Strategic Economic Partnership, done at Tokyo, March, 27, 2007;

(l) customs duties on originating goods provided for in the items in staging category CL-MY-Wheat shall be eliminated at entry into force of this Agreement for Chile and Malaysia for the ad valorem component only. The specific duty shall apply as provided for in Law 18.525 or its successor;

(m) customs duties on originating goods provided for in the items in staging category CL-MY-Sugar shall be eliminated at entry into force of this Agreement for Chile and Malaysia for the ad valorem component only. The specific duty shall apply as provided for in Law 18.525 or its successor;

(n) customs duties on originating goods provided for in the items in staging category CL-MX FTA-Wheat shall be as established for the same items in the Free Trade Agreement between the Republic of Chile and the United Mexican States (ACE-No41), done at Santiago, April 17, 1998;

(o) customs duties on originating goods provided for in the items in staging category CL-MX FTA-Sugar shall be as established for the same items in the Free Trade Agreement between the Republic of Chile and the United Mexican States (ACE-No41), done at Santiago, April 17, 1998;

(p) customs duties on originating goods provided for in the items in staging category CL-PE FTA-Wheat shall be as established for the same items in the Chile-Peru Free Trade Agreement (ACE-No38), done at Lima, August 22, 2006;

(q) customs duties on originating goods provided for in the items in staging category CL-PE FTA-Sugar shall be as established for the same items in the Chile-Peru Free Trade Agreement (ACE-No38), done at Lima, August 22, 2006;

(r) customs duties on originating goods provided for in the items in staging category CL-US FTA-Wheat shall be as established for the same items in the Chile-United States Free Trade Agreement, done at Miami, June 6, 2003;

(s) customs duties on originating goods provided for in the items in staging category CL-US FTA-Sugar shall be as established and subject to the conditions for the same items in the Chile-United States Free Trade Agreement, done at Miami, June 6, 2003;

(t) customs duties on originating goods provided for in the items in staging category CL-VN-Wheat shall be eliminated at entry into force of this Agreement for Chile and Viet Nam for the ad valorem component only. The specific duty shall apply as provided for in Law 18.525 or its successor;

(u) customs duties on originating goods provided for in the items in staging category CL-VN-Sugar shall be eliminated at entry into force of this Agreement for Chile and Viet Nam for the ad valorem component only. The specific duty shall apply as provided for in Law 18.525 or its successor; and

(v) customs duties on originating goods provided for in the items in staging category CL-MFN shall be the Most-Favoured-Nation rate of duty.

5. The annual stages referred to in paragraph 4 for the elimination or reduction of customs duties shall be equal, annual stages, except:

(a) as provided in paragraphs 3(b)(i), 4(a)(ii) and 4(b)(ii) in Section A of this Annex; or

(b) as otherwise provided in paragraph 4.

6.

(a) Upon request from Japan, Chile and Japan shall consult to consider Chile's commitments to Japan regarding treatment of originating goods related to the application of customs duties, tariff rate quotas and safeguards in this Schedule no sooner than seven years after the date of entry into force of this Agreement for Chile and Japan, with a view to increasing market access.

(b) Following completion of applicable legal procedures by Chile and another State or customs territory necessary for entry into force of an international agreement, or an amendment thereto, granting preferential market access by Chile to that other State or customs territory, and on request of Japan, Chile and Japan shall consult to consider Chile's commitments to Japan regarding treatment of originating goods related to the application of customs duties, tariff rate quotas and safeguards in this Schedule, with a view to providing to the originating goods treatment equivalent to that provided to goods classified in the same tariff lines under the international agreement. Chile and Japan shall consult no later than one month after the date of the request, unless Chile and Japan agree otherwise.

(c) For greater certainty, nothing in this paragraph shall be construed to affect the rights or obligations of Chile under any other provision of this Agreement.


TARIFF SCHEDULE OF CHILE (HS2012)

ANNEX 2-D

TARIFF SCHEDULE OF JAPAN GENERAL NOTES

1. The nine-digit codes of the tariff classification number of Japan referred to in this Schedule are based on the national nomenclature of Japan (Statistical Code Lists for Imports as of April 1, 2015.). For greater certainty, they are subject to change in accordance with the laws, regulations or public notifications of Japan, and shall be referred to together with the correlation tables published in accordance with Article 2.16(k) (Publication) in case of any change of national nomenclature of Japan. This Schedule is made based on the Harmonized System, as amended on 1 January 2012.

2. The base rates of duty set out in this Schedule reflect Japan's Most Favoured-Nation (MFN) rates of duty in effect on January 1, 2010, except for items identified by an asterisk ("*") adjacent to the base rate. For these items, the applicable base rates of duty are otherwise indicated in this Schedule.

3. In this Schedule, rates of duty expressed in monetary units shall be rounded to the nearest hundredth of a Japanese Yen.

4. The following staging categories shall apply to the elimination or reduction of customs duties by Japan pursuant to Article 2.4.2 (Elimination of Customs Duties):

(a) customs duties on originating goods provided for in the items in staging category EIF shall be eliminated entirely, and these goods shall be duty-free on the date of entry into force of this Agreement for Japan;

(b) customs duties other than the levy on originating goods provided for in the items in staging category JPEIF* shall be eliminated entirely on the date of entry into force of this Agreement for Japan. The rate of the levy charged on these goods shall be the rate subtracting 1.5 yen per kilogramme from the rate of the levy on sugar centrifugal of cane sugar classified under the tariff item 170114.110, whose content of sucrose by weight, in the dry state, corresponds to a polarimetric reading of less than 98.5 degrees;

(c) customs duties on originating goods provided for in the items in staging category B4 shall be eliminated in four annual stages, and these goods shall be duty-free effective April 1 of Year 4;

(d) customs duties on originating goods provided for in the items in staging category B6 shall be eliminated in six annual stages, and these goods shall be duty-free effective April 1 of Year 6;

(e) customs duties on originating goods provided for in the items in staging category JPB6* shall be eliminated as follows:

(i) the customs duties shall be reduced by 20 per cent of the base rate on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall be eliminated from the level set out in subparagraph (i) in five annual stages beginning on April 1 of Year 2, and these goods shall be duty-free effective April 1 of Year 6;

(f) customs duties on originating goods provided for in the items in staging category JPB6** shall be eliminated as follows:

(i) the customs duties shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall be eliminated from the level set out in subparagraph (i) in five annual stages beginning on April 1 of Year 2, and these goods shall be duty-free effective April 1 of Year 6;

(g) customs duties on originating goods provided for in the items in staging category JPB6*** shall remain at the base rate until March 31 of Year 5, and these goods shall be duty-free effective April 1 of Year 6;

(h) customs duties on originating goods provided for in the items in staging category JPB6**** shall be eliminated as follows:

(i) the customs duties shall be reduced to 25 per cent ad valorem and 40 yen per kilogramme on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall be eliminated from the level set out in subparagraph (i) in five annual stages beginning on April 1 of Year 2, and these goods shall be duty-free effective April 1 of Year 6;

(j) customs duties on originating goods provided for in the items in staging category B8 shall be eliminated in eight annual stages, and these goods shall be duty-free effective April 1 of Year 8;

(k) customs duties on originating goods provided for in the items in staging category JPB8* shall be eliminated as follows:

(i) the customs duties shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall be eliminated from the level set out in subparagraph (i) in seven annual stages beginning on April 1 of Year 2, and these goods shall be duty-free effective April 1 of Year 8;

(l) customs duties on originating goods provided for in the items in staging category JPB8** shall be eliminated as follows:

(i) the customs duties shall be reduced by 20 per cent of the base rate on the date of entry into force of this Agreement for Japan;

(ii) the customs duties shall remain at the level set out in subparagraph (i) until March 31 of Year 3; and

(iii) the customs duties shall be eliminated from the level set out in subparagraph (i) in five annual stages beginning on April 1 of Year 4, and these goods shall be duty-free effective April 1 of Year 8;

(m) customs duties on originating goods provided for in the items in staging category JPB8*** shall be eliminated as follows:

(i) the customs duties shall be reduced by one third of the base rate on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall be eliminated from the level set out in subparagraph (i) in seven annual stages beginning on April 1 of Year 2, and these goods shall be duty-free effective April 1 of Year 8;

(n) customs duties on originating goods provided for in the items in staging category JPB8**** shall be eliminated as follows:

(i) the customs duties shall be reduced to 10 per cent ad valorem or 125 yen per litre, whichever is less, subject to a minimum duty of 44.67 yen per litre, on the date of entry into force of this Agreement for Japan;

(ii) the customs duties shall be reduced to 8.5 per cent ad valorem or 125 yen per litre, whichever is less, subject to a minimum duty of 35.73 yen per litre, on April 1 of Year 2;

(iii) the customs duties shall be reduced to 7.1 per cent ad valorem or 125 yen per litre, whichever is less, subject to a minimum duty of 26.80 yen per litre, on April 1 of Year 3;

(iv) the customs duties shall be reduced to 5.7 per cent ad valorem or 125 yen per litre, whichever is less, subject to a minimum duty of 17.87 yen per litre, on April 1 of Year 4;

(v) the customs duties shall be reduced to 4.2 per cent ad valorem or 125 yen per litre, whichever is less, subject to a minimum duty of 8.93 yen per litre, on April 1 of Year 5;

(vi) the customs duties shall be reduced to 2.8 per cent ad valorem or 125 yen per litre, whichever is less, on April 1 of Year 6;

(vii) the customs duties shall be reduced to 1.4 per cent ad valorem or 125 yen per litre, whichever is less, on April 1 of Year 7; and

(viii) these goods shall be duty-free effective April 1 of Year 8;

(o) customs duties on originating goods provided for in the items in staging category JPB8***** shall be eliminated as follows:

(i) the customs duties shall be reduced to 10 per cent ad valorem or 125 yen per litre, whichever is less, subject to a minimum duty of 44.67 yen per litre, on the date of entry into force of this Agreement for Japan;

(ii) the customs duties shall be reduced to 8.5 per cent ad valorem or 125 yen per litre, whichever is less, subject to a minimum duty of 38.29 yen per litre, on April 1 of Year 2;

(iii) the customs duties shall be reduced to 7.1 per cent ad valorem or 125 yen per litre, whichever is less, subject to a minimum duty of 31.90 yen per litre, on April 1 of Year 3;

(iv) the customs duties shall be reduced to 5.7 per cent ad valorem or 125 yen per litre, whichever is less, subject to a minimum duty of 25.52 yen per litre, on April 1 of Year 4;

(v) the customs duties shall be reduced to 4.2 per cent ad valorem or 125 yen per litre, whichever is less, subject to a minimum duty of 19.14 yen per litre, on April 1 of Year 5;

(vi) the customs duties shall be reduced to 2.8 per cent ad valorem or 125 yen per litre, whichever is less, subject to a minimum duty of 12.76 yen per litre, on April 1 of Year 6;

(vii) the customs duties shall be reduced to 1.4 per cent ad valorem or 125 yen per litre, whichever is less, subject to a minimum duty of 6.38 yen per litre, on April 1 of Year 7; and

(viii) these goods shall be duty-free effective April 1 of Year 8;

(p) customs duties on originating goods provided for in the items in staging category B9 shall be eliminated in nine annual stages, and these goods shall be duty-free effective April 1 of Year 9;

(q) customs duties on originating goods provided for in the items in staging category JPB10* shall be eliminated as follows:

(i) the customs duties shall be reduced to 2.2 per cent ad valorem on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall be eliminated from the level set out in subparagraph (i) in nine annual stages beginning on April 1 of Year 2, and these goods shall be duty-free effective April 1 of Year 10;

(r) customs duties on originating goods provided for in the items in staging category B11 shall be eliminated in 11 annual stages, and these goods shall be duty-free effective April 1 of Year 11;

(s) customs duties on originating goods provided for in the items in staging category JPB11* shall be:

(i) from the date of entry into force of this Agreement for Japan until March 31 of Year 10, the difference between:

(A) the sum of:

(1) the value per kilogramme obtained by multiplying the value for customs duty per kilogramme by the Coefficient; and

(2) the value per kilogramme set out in Column 2 of the table below; and

For the purposes of this subparagraph, the Coefficient shall be the difference between:

(3) 100 per cent plus the rate set out in Column 3 of the table below; and

(4) the value obtained by dividing the value per kilogramme set out in Column 2 in the table below by 897.59 yen per kilogram; and

(B) the value for customs duty per kilogramme; and

(ii) zero, effective April 1 of Year 11;

(t) customs duties on originating goods provided for in the items in staging category JPB11** shall be eliminated as follows:

(i) the customs duties shall be reduced to 4.3 per cent ad valorem on the date of entry into force of this Agreement for Japan;

(ii) the customs duties shall be reduced to 2.2 per cent ad valorem from the level set out in subparagraph (i) in four annual stages beginning on April 1 of Year 2; and

(iii) the customs duties shall be eliminated from the level set out in subparagraph (ii) in six annual stages beginning on April 1 of Year 6, and these goods shall be duty-free effective April 1 of Year 11;

(u) customs duties on originating goods provided for in the items in staging category JPB11*** shall be eliminated as follows:

(i) the customs duties shall be reduced by 25 per cent of the base rate on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall be eliminated from the level set out in subparagraph (i) in 10 annual stages beginning on April 1 of Year 2, and these goods shall be duty-free effective April 1 of Year 11;

(v) customs duties on originating goods provided for in the items in staging category JPB11**** shall be eliminated as follows:

(i) the customs duties shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement for Japan;

(ii) the customs duties shall remain at the level set out in subparagraph (i) until March 31 of Year 10; and

(iii) the customs duties shall be eliminated and, these goods shall be duty-free effective April 1 of Year 11;

(w) customs duties on originating goods provided for in the items in staging category JPB11***** shall be eliminated as follows:

(i) the customs duties shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall be eliminated from the level set out in subparagraph (i) in 10 annual stages beginning on April 1 of Year 2, and these goods shall be duty-free effective April 1 of Year 11;

(x) customs duties on originating goods provided for in the items in staging category JPB12* shall be eliminated as follows:

(i) the customs duties shall remain at the base rate until March 31 of Year 8; and

(ii) the customs duties shall be eliminated from the base rate in four annual stages beginning on April 1 of Year 9, and these goods shall be duty-free effective April 1 of Year 12;

(y) customs duties on originating goods provided for in the items in staging category JPB13* shall be eliminated as follows:

(i) the customs duties shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall be eliminated from the level set out in subparagraph (i) in 12 annual stages beginning on April 1 of Year 2, and these goods shall be duty-free effective April 1 of Year 13;

(z) customs duties on originating goods provided for in the items in staging category JPB13** shall be eliminated as follows:

(i) the customs duties shall be reduced by 20 per cent of the base rate on the date of entry into force of this Agreement for Japan;

(ii) the customs duties shall remain at the level set out in subparagraph (i) until March 31 of Year 6; and

(iii) the customs duties shall be eliminated from the level set out in subparagraph (ii) in seven annual stages beginning on April 1 of Year 7, and these goods shall be duty-free effective April 1 of Year 13;

ANNEX 2-D – GENERAL NOTES – JAPAN – 8

(aa) customs duties on originating goods provided for in the items in staging category JPB13*** shall be eliminated as follows:

(i) the customs duties shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement for Japan;

(ii) the customs duties shall remain at the level set out in subparagraph (i) until March 31 of Year 6;

(iii) the customs duties shall be reduced by 25 per cent of the base rate from the level set out in subparagraph (ii) on April 1 of Year 7;

(iv) the customs duties shall remain at the level set out in subparagraph (iii) until March 31 of Year 12; and

(v) the customs duties shall be eliminated, and these goods shall be duty-free effective April 1 of Year 13;

(bb) customs duties on originating goods provided for in the items in staging category B16 shall be eliminated in 16 annual stages, and these goods shall be duty-free effective April 1 of Year 16;

(cc) customs duties on originating goods provided for in the items in staging category JPB16* shall be:

(i) from the date of entry into force of this Agreement for Japan until March 31 of Year 15, the lesser of:

(A) the difference between the value for customs duty per unit and the value per each obtained by multiplying 20,400.55 yen per each by 100 per cent plus the rate set out in Column 3 of the table below; and

(B) the value set out in Column 2 of the table below; and

(ii) zero, effective April 1 of Year 16;

(dd) customs duties on originating goods provided for in the items in staging category JPB16** shall be eliminated as follows:

(i) the customs duties shall be reduced to 25 per cent ad valorem and 40 yen per kilogramme on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall be eliminated from the level set out in subparagraph (i) in 15 annual stages beginning on April 1 of Year 2, and these goods shall be duty-free effective April 1 of Year 16;

(ee) customs duties on originating goods provided for in the items in staging category JPB16*** shall be eliminated as follows:

(i) the customs duties shall be reduced to 35 per cent ad valorem and 40 yen per kilogramme on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall be eliminated from the level set out in subparagraph (i) in 15 annual stages beginning on April 1 of Year 2, and these goods shall be duty-free effective April 1 of Year 16;

(ff) customs duties on originating goods provided for in the items in staging category JPB16**** shall be eliminated as follows:

(i) the customs duties shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement for Japan;

(ii) the customs duties shall remain at the level set out in subparagraph (i) until March 31 of Year 15; and

ANNEX 2-D – GENERAL NOTES – JAPAN – 10

(iii) the customs duties shall be eliminated and these goods shall be duty-free effective April 1 of Year 16;

(gg) customs duties on originating goods provided for in the items in staging category JPB21* shall be eliminated as follows:

(i) the customs duties shall be reduced to 25 per cent ad valorem and 40 yen per kilogramme on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall be eliminated from the level set out in subparagraph (i) in 20 annual stages beginning on April 1 of Year 2, and these goods shall be duty-free effective April 1 of Year 21;

(hh) customs duties on originating goods provided for in the items in staging category JPB21** shall be eliminated as follows:

(i) the customs duties shall be reduced to 35 per cent ad valorem and 40 yen per kilogramme on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall be eliminated from the level set out in subparagraph (i) in 20 annual stages beginning on April 1 of Year 2, and these goods shall be duty-free effective April 1 of Year 21;

(ii) customs duties on originating goods provided for in the items in staging category JPB21*** shall be eliminated as follows:

(i) the customs duties shall be reduced by 80 per cent of the base rate in 11 annual stages beginning on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall be eliminated from the level set out in subparagraph (i) in 10 annual stages beginning on April 1 of Year 12, and these goods shall be duty-free effective April 1 of Year 21;

(jj) customs duties on originating goods provided for in the items in staging category JPR2 shall be reduced as follows:

(i) (A) the customs duties shall be reduced to 27.5 per cent ad valorem on the date of entry into force of this Agreement for Japan;

(B) the customs duties shall be reduced to 20 per cent ad valorem from the level set out in subparagraph (A) in nine annual stages beginning on April 1 of Year 2;

(C) the customs duties shall be reduced to 9 per cent ad valorem from the level set out in subparagraph (B) in six annual stages beginning on April 1 of Year 11; and

(D) the customs duties shall remain at 9 per cent ad valorem from Year 16; and

(ii) notwithstanding subparagraph (i), if the customs duties on the originating goods as defined in subparagraph (o) of Article 1.2 of the Agreement between Japan and Australia for an Economic Partnership (JAEPA), which are classified under headings 02.01 and 02.02 under the JAEPA, are less than those set out in subparagraph (i) under this Agreement at any time, the former rate shall apply to the originating goods provided for in the items in staging category JPR2 under this Agreement;

(kk) customs duties on originating goods provided for in the items in staging category JPR3 shall be reduced as follows:

(i) the customs duties shall be reduced to 39 per cent ad valorem on the date of entry into force of this Agreement for Japan;

(ii) the customs duties shall be reduced to 20 per cent ad valorem from the level set out in subparagraph (i) in nine annual stages beginning on April 1 of Year 2;

(iii) the customs duties shall be reduced to 9 per cent ad valorem from the level set out in subparagraph (ii) in six annual stages beginning on April 1 of Year 11; and

(iv) the customs duties shall remain at 9 per cent ad valorem from Year 16;

(ll) customs duties on originating goods provided for in the items in staging category JPR4 shall be the lesser of:

(i) the difference between the value of the customs duty per kilogramme and the value per kilogramme obtained by multiplying 393 yen per kilogramme by 100 per cent plus the rate set out in Column 3 of the table below; and

(ii) the value set out in Column 2 of the table below;

(mm) customs duties on originating goods provided for in the items in staging category JPR5 shall be the lesser of:

(i) the difference between the value of the customs duty per kilogramme and the value per kilogramme obtained by multiplying 524 yen per kilogramme by 100 per cent plus the rate set out in Column 3 of the table below; and

(ii) the value set out in Column 2 of the table below;

(nn) customs duties on originating goods provided for in the items in staging category JPR6 shall be reduced as follows:

(i) the customs duties shall be reduced by 70 per cent of the base rate in six annual stages beginning on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall remain at the level set out in subparagraph (i) from Year 6;

(oo) customs duties on originating goods provided for in the items in staging category JPR7 shall be reduced by 10 per cent of the base rate on the date of entry into force of this Agreement for Japan and shall remain at that level thereafter;

(pp) customs duties on originating goods provided for in the items in staging category JPR8 shall be reduced as follows:

(i) the customs duties shall be reduced by 55 per cent of the base rate in six annual stages beginning on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall remain at the level set out in subparagraph (i) from Year 6;

(qq) customs duties on originating goods provided for in the items in staging category JPR9 shall be reduced as follows:

(i) the customs duties shall be reduced by 50 per cent of the base rate in six annual stages beginning on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall remain at the level set out in subparagraph (i) from Year 6;

(rr) customs duties on originating goods provided for in the items in staging category JPR10 shall be reduced as follows:

(i) the customs duties shall be reduced by 90 per cent of the base rate in six annual stages beginning on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall remain at the level set out in subparagraph (i) from Year 6;

ANNEX 2-D – GENERAL NOTES – JAPAN – 14

(ss) customs duties on originating goods provided for in the items in staging category JPR11 shall be reduced as follows:

(i) the customs duties shall be reduced by 72 per cent of the base rate in six annual stages beginning on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall remain at the level set out in subparagraph (i) from Year 6;

(tt) customs duties on originating goods provided for in the items in staging category JPR12 shall be reduced as follows:

(i) the customs duties shall be reduced by 75 per cent of the base rate in six annual stages beginning on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall remain at the level set out in subparagraph (i) from Year 6;

(uu) customs duties on originating goods provided for in the items in staging category JPR13 shall be reduced as follows:

(i) the customs duties shall be reduced by 50 per cent of the base rate in 11 annual stages beginning on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall remain at the level set out in subparagraph (i) from Year 11;

(vv) customs duties on originating goods provided for in the items in staging category JPR14 shall be reduced by 15 per cent of the base rate on the date of entry into force of this Agreement for Japan and shall remain at that level thereafter;

(ww) customs duties on originating goods provided for in the items in staging category JPR15 shall be reduced by 25 per cent of the base rate on the date of entry into force of this Agreement for Japan and shall remain at that level thereafter;

(xx) customs duties on originating goods provided for in the items in staging category JPR16 shall be reduced as follows:

(i) the customs duties shall be reduced by 15 per cent of the base rate in six annual stages beginning on the date of entry into force of this Agreement for Japan; and

ANNEX 2-D – GENERAL NOTES – JAPAN – 15

(ii) the customs duties shall remain at the level set out in subparagraph (i) from Year 6;

(yy) customs duties on originating goods provided for in the items in staging category JPR17 shall be reduced by five per cent of the base rate on the date of entry into force of this Agreement for Japan and shall remain at that level thereafter;

(zz) customs duties on originating goods provided for in the items in staging category JPR18 shall be reduced as follows:

(i) the customs duties shall be reduced by 25 per cent of the base rate in six annual stages beginning on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall remain at the level set out in subparagraph (i) from Year 6;

(aaa) customs duties on originating goods provided for in the items in staging category JPR19 shall be reduced as follows:

(i) the customs duties shall be reduced by 15 per cent of the base rate in four annual stages beginning on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall remain at the level set out in subparagraph (i) from Year 4;

(bbb) customs duties on originating goods provided for in the items in staging category JPR20 shall be reduced as follows:

(i) the customs duties shall be reduced by 60 per cent of the base rate in nine annual stages beginning on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall remain at the level set out in subparagraph (i) from Year 9;

(ccc) customs duties on originating goods provided for in the items in staging category JPR21 shall be reduced as follows:

(i) the customs duties shall be reduced by 55 per cent of the base rate in nine annual stages beginning on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall remain at the level set out in subparagraph (i) from Year 9;

ANNEX 2-D – GENERAL NOTES – JAPAN – 16

(ddd) customs duties on originating goods provided for in the items in staging category JPR22 shall be reduced as follows:

(i) the customs duties shall be reduced by 60 per cent of the base rate in six annual stages beginning on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall remain at the level set out in subparagraph (i) from Year 6;

(eee) customs duties on originating goods provided for in the items in staging category JPR23 shall be reduced as follows:

(i) the customs duties shall be reduced by 63 per cent of the base rate in six annual stages beginning on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall remain at the level set out in subparagraph (i) from Year 6;

(fff) customs duties on originating goods provided for in the items in staging category JPR24 shall be reduced as follows:

(i) the customs duties shall be reduced by 66.6 per cent of the base rate in six annual stages beginning on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall remain at the level set out in subparagraph (i) from Year 6;

(ggg) customs duties on originating goods provided for in the items in staging category JPR25 shall be reduced as follows:

(i) the customs duties shall be reduced by 67 per cent of the base rate in six annual stages beginning on the date of entry into force of this Agreement for Japan; and

(ii) the customs duties shall remain at the level set out in subparagraph (i) from Year 6;

(hhh) for originating goods provided for in the items in staging category JPM1, which are subject to quotas under the WTO Agreement, the maximum amount that Japan may add to the amount paid for these goods when setting the minimum selling price (maximum import mark-up to set the minimum selling price) shall be as follows:

(i) 16.2 yen per kilogramme for Year 1;

(ii) 15.3 yen per kilogramme for Year 2;

(iii) 14.5 yen per kilogramme for Year 3;

(iv) 13.6 yen per kilogramme for Year 4;

(v) 12.8 yen per kilogramme for Year 5;

(vi) 11.9 yen per kilogramme for Year 6;

(vii) 11.1 yen per kilogramme for Year 7;

(viii) 10.2 yen per kilogramme for Year 8; and

(ix) 9.4 yen per kilogramme for Year 9 and for each subsequent year;

(iii) for originating goods provided for in the items in staging category JPM2, which are subject to quotas under the WTO Agreement, the maximum import mark-up to set the minimum selling price shall be as follows:

(i) 7.6 yen per kilogramme for Year 1;

(ii) 7.2 yen per kilogramme for Year 2;

(iii) 6.8 yen per kilogramme for Year 3;

(iv) 6.4 yen per kilogramme for Year 4;

(v) 6.0 yen per kilogramme for Year 5;

(vi) 5.6 yen per kilogramme for Year 6;

(vii) 5.2 yen per kilogramme for Year 7;

(viii) 4.8 yen per kilogramme for Year 8; and

(ix) 4.4 yen per kilogramme for Year 9 and for each subsequent year;

(jjj) customs duties on originating goods provided for in the items in staging category TRQ shall be governed by the terms of TRQ applicable to that tariff item, as set out in Appendix A (Tariff Rate Quotas of Japan) to this Schedule; and

(kkk) customs duties on originating goods provided for in the items in staging category MFN shall be at the most-favoured-nation rate of customs duties in effect at the time of import.

5. Originating goods provided for in the items marked with the designation "SG-[n]" in this Schedule shall be subject to the corresponding safeguard measure set out in Appendix B-1 (Agricultural Safeguard Measures) and Appendix B-2 (Forest Good Safeguard Measure) to this Schedule.

6. For the purposes of implementing annual stages of tariff reduction provided for in this Schedule, the following shall apply:

(a) the reduction for Year 1 shall take place on the date of entry into force of this Agreement for Japan; and

(b) the subsequent annual reductions shall take place each April 1 thereafter.

7. For the purposes of this Schedule, year means, with respect to Year 1, the period from the date of entry into force of this Agreement for Japan until the following March 31 and, with respect to each subsequent Year, the twelve-month period which starts on April 1 of that year.

8. The annual stages referred to in paragraph 4 for the elimination or reduction of customs duties shall be equal, annual stages, except:

(a) as provided in paragraphs 3(b)(i), 4(a)(ii) and 4(b)(ii) of Section A of this Annex; or

(b) as otherwise provided in paragraph 4.

9.

(a) Upon request from Australia, Canada, Chile, New Zealand or the United States, Japan and the requesting Party shall consult to consider Japan's commitments to the requesting Party regarding treatment of originating goods related to the application of customs duties, tariff rate quotas and safeguards in this Schedule no sooner than seven years after the date of entry into force of this Agreement for Japan and the requesting Party, with a view to increasing market access.

(b) Following completion of applicable legal procedures by Japan and another State or customs territory necessary for entry into force of an international agreement, or an amendment thereto, granting preferential market access by Japan to that other State or customs territory, and on request of Australia, Canada, Chile, New Zealand or the United States, Japan and the requesting Party shall consult to consider Japan's commitments to the requesting Party regarding treatment of originating goods related to the application of customs duties, tariff rate quotas and safeguards in this Schedule, with a view to providing to the originating goods treatment equivalent to that provided to goods classified in the same tariff lines under the international agreement. Japan and the requesting Party shall consult no later than one month after the date of the request, unless Japan and the requesting Party agree otherwise.

(c) For greater certainty, nothing in this paragraph shall be construed to affect the rights or obligations of Japan under any other provision of this Agreement.

10. Appendix C (Tariff Differentials) to this Schedule shall apply when Japan applies different rates of customs duty to other Parties for an originating good specified in that Appendix.


TARIFF SCHEDULE OF JAPAN (HS2012)

APPENDIX A

TARIFF RATE QUOTAS OF JAPAN

Section A: General Provisions

1. For the purposes of paragraph 4(jjj) of the General Notes of the Tariff Schedule of Japan, customs duties on originating goods provided for in the tariff items indicated with "TWQ-n" or "CSQ-n" in Column "Remarks" in the Tariff Schedule of Japan shall be governed by the terms of the TRQ for that specific tariff items, as set out in this Appendix, beginning on the date of entry into force of this Agreement for Japan.

2. For the purposes of implementing annual stages in this Appendix, the following shall apply:

(a) the reduction for Year 1 shall take place on the date of entry into force of this Agreement for Japan; and

(b) the subsequent annual reductions shall take place on April 1 of each following year.

3. For the purposes of this Appendix, year means, with respect to Year 1, the period from the date of entry into force of this Agreement for Japan until the following March 31 and, with respect to each subsequent Year, the twelve-month period which starts on April 1 of that year.

4. In this Appendix, the descriptions of product or products in the title of each TRQ are not necessarily exhaustive. These descriptions are included solely to assist users in understanding this Appendix and shall not alter or supersede the coverage for each TRQ established by reference to the relevant tariff items.

Section B: TPP Wide TRQs (TWQs)

1. TWQ-JP1: Wheat Products

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties that shall be duty-free, subject to an import mark-up applied by Japan as provided in subparagraph (d), in a particular year is specified below:

For Year 7 and for each subsequent year, the aggregate quota quantity shall remain at 10,000 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 190410.221, 190420.221, 190430.010, 190490.210 and 210690.214.

(d) TWQ-JP1 shall be established outside the tariff-rate quota in Japan's Schedule to the WTO Agreement and shall be administered by the Ministry of Agriculture, Forestry and Fisheries of Japan (MAFF), or its successor, as a State Trading Enterprise using a simultaneous buy-sell (SBS) mechanism. Japan may collect the import mark-up for goods imported under the TRQ set out in this paragraph. The amount of the import mark-up shall not exceed the amount permitted for the good under Japan's Schedule to the WTO Agreement.

2. TWQ-JP2: Food Preparations Made Primarily of Wheat

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties that shall be duty-free in a particular year is specified below:

For Year 7 and for each subsequent year, the aggregate quota quantity shall remain at 22,500 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 190190.242, 190190.247, 190190.252 and 190190.267.

(d) TWQ-JP2 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

3. TWQ-JP3: Wheat Flour, Pellets, Rolled and Food Preparations

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties that shall be duty-free, subject to an import mark-up applied by Japan as provided in subparagraph (d), in a particular year is specified below:

For Year 7 and for each subsequent year, the aggregate quota quantity shall remain at 7,500 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 110100.011, 110100.091, 110290.210, 110311.010, 110319.210, 110320.110, 110320.510, 110419.111, 110419.121, 110429.111, 110429.121, 110811.010, 190120.131, 190120.151, 190190.151 and 190190.171.

(d) TWQ-JP3 shall be established outside the tariff-rate quota in Japan's Schedule to the WTO Agreement and shall be administered by MAFF, or its successor, as a State Trading Enterprise using a SBS mechanism. Japan may collect the import mark-up for goods imported under the TRQ set out in this paragraph. The amount of the import mark-up shall not exceed the amount permitted for the good under Japan's Schedule to the WTO Agreement.

4. TWQ-JP4: Uncooked Udon, Somen and Soba

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties that shall be duty-free in a particular year is specified below:

For Year 2 and for each subsequent year, the aggregate quota quantity shall remain at 100 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 190219.092.

(d) TWQ-JP4 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

5. TWQ-JP5: Food Preparations of Barley

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties that shall be duty-free, subject to an import mark-up applied by Japan as provided in subparagraph (d), in a particular year is specified below:

For Year 7 and for each subsequent year, the aggregate quota quantity shall remain at 115 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 190120.141, 190190.161, 190420.231, 190490.310 and 210690.216.

(d) TWQ-JP5 shall be established outside the tariff-rate quota in Japan's Schedule to the WTO Agreement and shall be administered by MAFF, or its successor, as a State Trading Enterprise using a SBS mechanism. Japan may collect the import mark-up for goods imported under the TRQ set out in this paragraph. The amount of the import mark-up shall not exceed the amount permitted for the good under Japan's Schedule to the WTO Agreement.

6. TWQ-JP6: Barley Flour, Groats and Pellets

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties that shall be duty-free, subject to an import mark-up applied by Japan as provided in subparagraph (d), in a particular year is specified below:

For Year 7 and for each subsequent year, the aggregate quota quantity shall remain at 500 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 110290.110, 110319.110, 110320.410, 110419.410, 110429.410 and 190410.231.

(d) TWQ-JP6 shall be established outside the tariff-rate quota in Japan's Schedule to the WTO Agreement and shall be administered by MAFF, or its successor, as a State Trading Enterprise using a SBS mechanism. Japan may collect the import mark-up for goods imported under the TRQ set out in this paragraph. The amount of the import mark-up shall not exceed the amount permitted for the good under Japan's Schedule to the WTO Agreement.

7. TWQ-JP7: Barley

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties that shall be duty-free, subject to an import mark-up applied by Japan as provided in subparagraphs (e) and (f), and the maximum import mark-up to set the minimum selling price for each year for those goods, in a particular year are specified below:

For Year 10 and for each subsequent year, the aggregate quota quantity shall remain at 65,000 metric tonnes. For Year 10 and for each subsequent year, the maximum import mark-up to set the minimum selling price shall remain at 4.4 yen per kilogramme.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 100310.010 and 100390.019.

(d) TWQ-JP7 shall be established outside the tariff-rate quota in Japan's Schedule to the WTO Agreement and shall be administered by MAFF, or its successor, as a State Trading Enterprise using a SBS mechanism. A longer shipping period based on a trading contract between an importer and a producer shall be allowed.

(e) For the purposes of TWQ-JP7, maximum import mark-up to set the minimum selling price means the maximum amount that MAFF, or its successor, may add to the amount paid for goods when it sets the minimum selling price at or above which MAFF, or its successor, shall not reject a bid in an SBS tender unless the tender amount in the SBS tender is fully subscribed through higher bids.

(f) The difference between the amount paid by the purchaser in an SBS transaction for goods and the amount paid by MAFF, or its successor, for the goods shall be retained by MAFF, or its successor, as the import mark-up for the goods, which can be more

than the maximum import mark-up to set the minimum selling price but shall not exceed the amount permitted for the goods under Japan's Schedule to the WTO Agreement.

8. TWQ-JP8: Fresh Cheese for Use as Materials for Shredded Cheese

(a) The in-quota rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties shall be duty-free, when:

(i) the aggregate quota quantity for each year shall be stipulated by laws, regulations or ministerial ordinances of Japan in consideration of the quantity of prospective domestic production of natural cheese for use as materials for shredded cheese, and shall be set at a limit no less than the quantity of prospective domestic production of natural cheese for use as materials for shredded cheese multiplied by the ratio of 3.5; and

(ii) the quota quantity to be allocated for each application made by an importer shall not exceed the limit of the ratio in subparagraph (a)(i) multiplied by the quantity of natural cheese, specified in the application, produced from domestic milk and used by the importer for the production of shredded cheese in Japan.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties which do not meet the requirement set out in subparagraph (a) shall be treated in accordance with staging category B16 for cream cheese for containing fat content, by weight, not exceeding 45 per cent, JPR7 for cream cheese for containing fat content, by weight, exceeding 45 per cent, and MFN for others as set out in paragraph 4(bb), 4(oo) and 4(kkk) respectively of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 040610.090.

(d) TWQ-JP8 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

9. TWQ-JP9: Butter

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (d) from the other Parties, expressed in terms of whole milk equivalent metric tonnes calculated with a conversion factor listed in subparagraph (b) and the in-quota rate of customs duty for those originating goods in a particular year are specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 45,898 whole milk equivalent metric tonnes, and for Year 12 and for each subsequent year, the in-quota rate of customs duty shall remain at 35 per cent.

(b) For the purposes of TWQ-JP9, the conversion factor set out in the right column of the following schedule indicates the coefficient for a calculation to obtain the weight in whole milk equivalent of the respective originating goods, expressed as tariff classification numbers set out in the left column in the following schedule:

(c) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (d) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(d) Subparagraphs (a), (b) and (c) shall apply to the originating goods provided for in the tariff items 040510.129, 040510.229, 040520.090, 040590.190 and 040590.229.

(e) TWQ-JP9 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

10. TWQ-JP10: Skimmed Milk Powder

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (d) from the other Parties, expressed in terms of whole milk equivalent metric tonnes calculated with a conversion factor listed in subparagraph (b) and the in-quota rate of customs duty for those originating goods in a particular year are specified below:

10 24,102 25% + 13yen/kg 35% + 13yen/kg 11 24,102 25% 35%

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 24,102 whole milk equivalent metric tonnes, and for Year 12 and for each subsequent year, the in-quota rate of customs duty shall remain at 25 per cent for skimmed milk powder (SMP) not containing added sugar, or 35 per cent for SMP containing added sugar.

(b) For the purposes of TWQ-JP10, the conversion factor set out in the right column of the following schedule indicates the coefficient for a calculation to obtain the weight in whole milk equivalent of the respective originating goods, expressed as tariff classification numbers set out in the left column in the following schedule:

(c) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (d) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(d) Subparagraphs (a), (b) and (c) shall apply to the originating goods provided for in the tariff items 040210.129, 040210.212, 040210.229, 040221.212, 040221.229 and 040229.291.

(e) TWQ-JP10 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

11. TWQ-JP11: Milk Powder and Butter Milk Powder

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (d) from the other Parties, expressed in terms of whole milk equivalent metric tonnes calculated with a conversion factor listed in subparagraph (b) and the in-quota rate of customs duty for those originating goods in a particular year are specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 2,250 whole milk equivalent metric tonnes, and for Year 12 and for each subsequent year, the in-quota rate of customs duty shall remain at 25 per cent for Butter Milk Powder not containing added sugar, 35 per cent for Butter Milk Powder containing added sugar, or 30 per cent for Milk Powder.

(b) For the purposes of TWQ-JP11, the conversion factor set out in the right column of the following schedule indicates the coefficient for a calculation to obtain the weight in whole milk equivalent of the respective originating goods, expressed as tariff classification numbers set out in the left column in the following schedule:

(c) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (d) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(d) Subparagraphs (a), (b) and (c) shall apply to the originating goods provided for in the tariff items 040221.119, 040221.129, 040229.119, 040229.129, 040390.113, 040390.123 and 040390.133.

(e) TWQ-JP11 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

12. TWQ-JP12: Milk Powder

(a) The in-quota rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (d) from the other Parties shall be duty-free, when:

(i) the aggregate volume of imports of the originating goods from the other Parties in any year does not exceed the aggregate quota quantity, expressed in terms of whole milk equivalent metric tonnes calculated with a conversion factor listed in subparagraph (b), specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 60,000 metric tonnes; and

(ii) the quota quantity to be allocated for each application made by an importer shall not exceed the limit of three multiplied by the quantity of the milk powder, specified in application, produced from domestic milk and used by the importer for the production of chocolate in Japan.

(b) For the purposes of TWQ-JP12, the conversion factor set out in the right column of the following schedule indicates the coefficient for a calculation to obtain the weight in whole milk equivalent of the respective originating goods, expressed as tariff classification numbers set out in the left column in the following schedule:

(c) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (d) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(d) Subparagraphs (a), (b) and (c) shall apply to the originating goods provided for in the tariff items 040221.119 and 040221.129.

(e) TWQ-JP12 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

13. TWQ-JP13: Food Preparations Containing Cocoa

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties and the in-quota rate of customs duty in a particular year are specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 5,500 metric tonnes. For Year 12 and for each subsequent year, the in-quota rate of customs duty shall remain at 10.6 per cent.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 180620.290.

(d) TWQ-JP13 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

14. TWQ-JP14: Food Preparations Containing Cocoa

(a) The in-quota rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties shall be duty-free, when:

(i) the aggregate volume of imports of the originating goods from the other Parties in any year does not exceed the aggregate quota quantity specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 12,000 metric tonnes; and

(ii) the quota quantity to be allocated for each application made by an importer shall not exceed the limit of three multiplied by the quantity of the milk powder, specified in application, produced from domestic milk and used by the importer for the production of chocolate in Japan.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 180620.290.

(d) TWQ-JP14 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

15. TWQ-JP15: Prepared Edible Fats and Oils

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties and the in-quota rate of customs duty in a particular year are specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 2,300 metric tonnes. For Year 12 and for each subsequent year, the in-quota rate of customs duty shall remain at 10.6 per cent.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 210690.291.

(d) TWQ-JP15 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

16. TWQ-JP16: Evaporated Milk

(a) The in-quota rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties shall be duty-free, when:

(i) the aggregate volume of imports of the originating goods from the other Parties in any year does not exceed the aggregate quota quantity specified below:

For Year 7 and for each subsequent year, the aggregate quota quantity shall remain at 4,750 metric tonnes; and

(ii) the originating goods are liquid at ordinary temperature, approximately from 1 to 32 degrees Celsius.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 040291.129 and 040291.290.

(d) TWQ-JP16 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

17. TWQ-JP17: Condensed Milk

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties that shall be duty-free in a particular year is specified below:

For Year 2 and for each subsequent year, the aggregate quota quantity shall remain at 750 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 040299.129 and 040299.290.

(d) TWQ-JP17 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

18. TWQ-JP18: Chewing Gum and Other Sugar Confectionery, Containing Cocoa

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties that shall be duty-free in a particular year is specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 360 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 180620.111 and 180620.119.

(d) TWQ-JP18 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

19. TWQ-JP19: Cocoa Preparations, Containing Added Sugar Weighing Not More Than 2 kg

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties that shall be duty-free in a particular year is specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 5,000 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 180632.211, 180632.219, 180690.211 and 180690.219.

(d) TWQ-JP19 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

20. TWQ-JP20: Coffee, Tea Mixes, Food Preparations and Doughs

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties that shall be duty-free in a particular year is specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 12,000 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 170290.219, 190120.239, 190190.217, 190190.248, 190190.253, 210112.110, 210112.246, 210120.246, 210690.251, 210690.271, 210690.272, 210690.279 and 210690.281.

(d) TWQ-JP20 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

21. TWQ-JP21: Preparations of Peas, Beans and Leguminous Vegetables

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties that shall be duty-free in a particular year is specified below:

For Year 7 and for each subsequent year, the aggregate quota quantity shall remain at 800 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 200540.190, 200551.190 and 200599.119.

(d) TWQ-JP21 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

22. TWQ-JP22: Candies, White Chocolate and Confectionary

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties that shall be duty-free in a particular year is specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 6,000 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 170490.210, 170490.230 and 170490.290.

(d) TWQ-JP22 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

23. TWQ-JP23: Chocolate

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties that shall be duty-free in a particular year is specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 18,000 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 180631.000, 180632.100 and 180690.100.

(d) TWQ-JP23 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

24. TWQ-JP24: Food Preparations

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties that shall be duty-free in a particular year is specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 3,000 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 210690.590.

(d) TWQ-JP24 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

25. TWQ-JP25: Cane Sugar Under 98.5 Polarimetric

(a) The in-quota rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties shall be duty-free, when:

(i) the aggregate volume of imports of the originating goods from the other Parties in any year does not exceed the aggregate quota quantity specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 25 metric tonnes; and

(ii) the originating goods are in containers for retail sale and do not exceed a net weight of 1 kilogramme per container.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 170113.000 and 170114.190.

(d) TWQ-JP25 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

26. TWQ-JP26: Cocoa Powder

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties and the in-quota rate of customs duty in a particular year are specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 7,500 metric tonnes. For Year 12 and for each subsequent year, the in-quota rate of

customs duty shall remain at 14.9 per cent.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 180610.100.

(d) TWQ-JP26 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

27. TWQ-JP27: Cocoa Preparations, Containing Added Sugar Weighing More Than 2 kg

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties and the in-quota rate of customs duty in a particular year are specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 18,600 metric tonnes. For Year 12 and for each subsequent year, the in-quota rate of customs duty shall remain at 16.8 per cent.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 180620.190.

(d) TWQ-JP27 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

28. TWQ-JP28: Food Preparations

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties and the in-quota rate of customs duty in a particular year are specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 2,700 metric tonnes. For Year 12 and for each subsequent year, the in-quota rate of customs duty shall remain at 14.0 per cent.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 190190.211.

(d) TWQ-JP28 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

29. TWQ-JP29: Food Preparation Containing More Than 50 Per Cent of Sucrose

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties and the in-quota rate of customs duty in a particular year are specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 12,300 metric tonnes. For Year 12 and for each subsequent year, the in-quota rate of

customs duty shall remain at 17.9 per cent.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 190190.219.

(d) TWQ-JP29 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

30. TWQ-JP30: Food Preparations (Sugar is the Largest Ingredient)

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties that shall be duty-free in a particular year is specified below:

For Year 7 and for each subsequent year, the aggregate quota quantity shall remain at 75 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 210690.282 and 210690.510.

(d) TWQ-JP30 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

31. TWQ-JP31: Food Preparations Containing Sugar and Dairy

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties and the in-quota rate of customs duty in a particular year are specified below.

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 8,200 metric tonnes. For Year 12 and for each subsequent year, the in-quota rate of customs duty shall remain at 17.9 per cent.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 210690.284.

(d) TWQ-JP31 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

32. TWQ-JP32: Sugar

(a) The in-quota rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties shall be duty-free, subject to levies which shall be refunded in accordance with the laws and regulations of Japan, when:

(i) the aggregate volume of imports of the originating goods from the other Parties in any year does not exceed the aggregate quota quantity specified below:

For Year 2 and for each subsequent year, the aggregate quota quantity shall remain at 500 metric tonnes; and

(ii) the originating goods are imported with certificate of product testing and development which certifies the originating goods meet criteria and conditions set out in the laws and regulations of Japan.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 170112.100, 170112.200, 170114.110, 170114.200, 170191.000, 170199.100, 170199.200, 170290.110, 170290.211, 170290.521 and 210690.221.

(d) TWQ-JP32 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate shall be issued by Japan.

33. TWQ-JP33: Starch

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (d) in a particular year is specified below:

For Year 2 and for each subsequent year, the aggregate quota quantity shall remain at 7,500 metric tonnes.

(b) (i) The in-quota rate of customs duty on originating goods provided for in the tariff items 110812.090, 110813.090, 110814.090, 110819.019 and 110819.099 from the other Parties shall be duty-free, subject to levy of up to 25 per cent only if those originating goods are imported for manufacturing starch sugar, dextrin, dextrin glue, dissolve starch, roasted starch or starch glue.

(ii) The in-quota rate of customs duty on originating goods provided for in the tariff item 110812.090 imported for the other purposes than those stipulated in subparagraph (b)(i) shall be 12.5 per cent.

(iii) The in-quota rate of customs duty on originating goods provided for in the tariff items 190120.159 (not containing added sugar) and 190190.179 (not containing added sugar) shall be 16 per cent.

(iv) The in-quota rate of customs duty on originating goods provided for in the tariff items 110813.090, 110814.090, 110819.019 and 110819.099 imported for the other purposes than those stipulated in subparagraph (b)(i) shall be 25 per cent.

(v) The in-quota rate of customs duty on originating goods provided for in the tariff items 110820.090, 190120.159 (containing added sugar) and 190190.179 (containing added sugar) shall be 25 per cent.

(c) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (d) from the other Parties imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(d) Subparagraphs (a), (b) and (c) shall apply to the originating goods provided for in the tariff items 110812.090, 110813.090, 110814.090, 110819.019, 110819.099, 110820.090, 190120.159 and 190190.179.

(e) TWQ-JP33 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

Section C: Country-Specific TRQs (CSQs)

1. CSQ-JP1: Rice for the United States

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the United States that shall be duty-free, subject to an import mark-up applied by Japan as provided in subparagraph (e), in a particular year is specified below:

For Year 14 and for each subsequent year, the aggregate quota quantity shall remain at 70,000 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the United States imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 100610.010, 100620.010, 100630.010, 100640.010, 110290.310, 110319.510, 110320.350, 110419.250, 110429.250, 190120.122, 190120.162, 190190.142, 190190.587, 190410.211, 190420.211, 190490.120 and 210690.517.

(d) For the purposes of CSQ-JP1, a good is from the United States if the good is harvested in the United States or produced in the United States from rice harvested in the United States.

(e) CSQ-JP1 shall be established outside the tariff-rate quota in Japan's Schedule to the WTO Agreement and shall be administered by MAFF, or its successor, as a State Trading Enterprise using a SBS mechanism. Japan may collect the import mark-up for goods imported under the TRQ set out in this paragraph. The amount of the import mark-up shall not exceed the amount permitted for the goods under Japan's Schedule to the WTO Agreement.

2. CSQ-JP2: Rice for Australia

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from Australia that shall be duty-free, subject to an import mark-up applied by Japan as provided in subparagraph (e), in a particular year is specified below:

For Year 14 and for each subsequent year, the aggregate quota quantity shall remain at 8,400 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from Australia imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 100610.010, 100620.010, 100630.010, 100640.010, 110290.310, 110319.510, 110320.350, 110419.250, 110429.250, 190120.122, 190120.162, 190190.142, 190190.587, 190410.211, 190420.211, 190490.120 and 210690.517.

(d) For the purposes of CSQ-JP2, a good is from Australia if the good is harvested in Australia or produced in Australia from rice harvested in Australia.

(e) CSQ-JP2 shall be established outside the tariff-rate quota in Japan's Schedule to the WTO Agreement and shall be administered by MAFF, or its successor, as a State Trading Enterprise using a SBS mechanism. Japan may collect the import mark-up for goods imported under the TRQ set out in this paragraph. The amount of the import mark-up shall not exceed the amount permitted for the goods under Japan's Schedule to the WTO Agreement.

3. CSQ-JP3: Mixes and Doughs and Cake Mixes for the United States

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the United States that shall be duty-free in a particular year is specified below:

For Year 7 and for each subsequent year, the aggregate quota quantity shall remain at 12,000 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the United States imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 190120.222, 190120.232, 190120.235 and 190120.243.

(d) For the purposes of CSQ-JP3, a good is from the United States if the good is produced in the United States exclusively from materials produced in the United States or from any materials not produced in the United States classified in a different HS Chapter than the one for the good.

(e) CSQ-JP3 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

4. CSQ-JP4: Mixes and Doughs and Cake Mixes for Parties Other than the United States

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from other Parties other than the United States that shall be duty-free in a particular year is specified below:

For Year 7 and for each subsequent year, the aggregate quota quantity shall remain at 8,000 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the other Parties except the United States imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 190120.222, 190120.232, 190120.235 and 190120.243.

(d) For the purposes of CSQ-JP4, a good is from a Party other than the United States if the good is produced in one or more Parties other than the United States from:

(i) materials produced in one or more Parties other than the United States;

(ii) other materials of a different HS Chapter than the HS Chapter of the good; or

(iii) a combination of materials set out in subparagraphs (i) and (ii).

(e) CSQ-JP4 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

5. CSQ-JP5: Wheat for the United States

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (d) from the United States that shall be duty-free, subject to an import mark-up applied by Japan as provided in subparagraphs (g) and (h), and the maximum import mark-up to set the minimum selling price for each year for those goods, in a particular year are specified below:

For Year 10 and for each subsequent year, the aggregate quota quantity shall remain at 150,000 metric tonnes. For Year 10 and for each subsequent year, the maximum import mark-up to set the minimum selling price shall remain at 9.4 yen per kilogramme for the originating goods classified under Group 1 and 8.5 yen per kilogramme for the originating goods classified under Group 2.

(b) For the purposes of CSQ-JP5:

(i) Group 1 means Dark Northern Spring, Hard Red Winter, Western White, Canadian Western Red Spring and Australia Standard White (Japan Blend) wheat classes; and

(ii) Group 2 means all wheat classes other than those set out in subparagraph (b)(i).

(c) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (d) from the United States imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(d) Subparagraphs (a), (b) and (c) shall apply to the originating goods provided for in the tariff items 100111.010, 100119.010, 100191.011, 100191.019, 100199.011, 100199.019 and 100860.210.

(e) For the purposes of CSQ-JP5, a good is from the United States if the good is harvested in the United States.

(f) CSQ-JP5 shall be established outside the tariff-rate quota in Japan's Schedule to the WTO Agreement and shall be administered by MAFF, or its successor, as a State Trading Enterprise using a SBS mechanism.

(g) For the purposes of CSQ-JP5, maximum import mark-up to set the minimum selling price means the maximum amount that MAFF, or its successor, may add to the amount paid for goods when it sets the minimum selling price at or above which MAFF, or its successor, shall not reject a bid in an SBS tender unless the tender amount in the SBS tender is fully subscribed through higher bids.

(h) The difference between the amount paid by the purchaser in an SBS transaction for goods and the amount paid by MAFF, or its successor, for the goods shall be retained by MAFF, or its successor, as the import mark-up for the goods, which can be more than the maximum import mark-up to set the minimum selling price but shall not exceed the amount permitted for the goods under Japan's Schedule to the WTO Agreement.

6. CSQ-JP6: Wheat for Australia

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (d) from Australia that shall be duty-free, subject to an import mark-up applied by Japan as provided in subparagraphs (g) and (h), and the maximum import mark-up to set the minimum selling price for each year for those goods, in a particular year are specified below:

For Year 10 and for each subsequent year, the aggregate quota quantity shall remain at 50,000 metric tonnes. For Year 10 and for each subsequent year, the maximum import mark-up to set the minimum selling price shall remain at 9.4 yen per kilogramme for the originating goods classified under Group 1 and 8.5 yen per kilogramme for the originating goods classified under Group 2.

(b) For the purposes of CSQ-JP6:

(i) Group 1 means Dark Northern Spring, Hard Red Winter, Western White, Canadian Western Red Spring and Australia Standard White (Japan Blend) wheat classes; and

(ii) Group 2 means all wheat classes other than those set out in subparagraph (i).

(c) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (d) from Australia imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(d) Subparagraphs (a), (b) and (c) shall apply to the originating goods provided for in the tariff items 100111.010, 100119.010, 100191.011, 100191.019, 100199.011, 100199.019 and 100860.210.

(e) For the purposes of CSQ-JP6, a good is from Australia if the good is harvested in Australia.

(f) CSQ-JP6 shall be established outside the tariff-rate quota in Japan's Schedule to the WTO Agreement and shall be administered by MAFF, or its successor, as a State Trading Enterprise using a SBS mechanism.

(g) For the purposes of CSQ-JP6, maximum import mark-up to set the minimum selling price means the maximum amount that MAFF, or its successor, may add to the amount paid for goods when it sets the minimum selling price at or above which MAFF, or its successor, shall not reject a bid in an SBS tender unless the tender amount in the SBS tender is fully subscribed through higher bids.

(h) The difference between the amount paid by the purchaser in an SBS transaction for goods and the amount paid by MAFF, or its successor, for the goods shall be retained by MAFF, or its successor, as the import mark-up for the goods, which can be more than the maximum import mark-up to set the minimum selling price but shall not exceed the amount permitted for the goods under Japan's Schedule to the WTO Agreement.

7. CSQ-JP7: Wheat for Canada

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (d) from Canada that shall be duty-free, subject to an import mark-up applied by Japan as provided in subparagraphs (g) and (h), and the maximum import mark-up to set the minimum selling price for each year for those goods, in a particular year are specified below:

For Year 10 and for each subsequent year, the aggregate quota quantity shall remain at 53,000 metric tonnes. For Year 10 and for each subsequent year, the maximum import

mark-up to set the minimum selling price shall remain at 9.4 yen per kilogramme for the originating goods classified under Group 1 and 8.5 yen per kilogramme for the originating goods classified under Group 2.

(b) For the purposes of CSQ-JP7:

(i) Group 1 means Dark Northern Spring, Hard Red Winter, Western White, Canadian Western Red Spring and

Australia Standard White (Japan Blend) wheat classes; and

(ii) Group 2 means all wheat classes other than those set out in subparagraph (i).

(c) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (d) from Canada imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(d) Subparagraphs (a), (b) and (c) shall apply to the originating goods provided for in the tariff items 100111.010, 100119.010, 100191.011, 100191.019, 100199.011, 100199.019 and 100860.210.

(e) For the purposes of CSQ-JP7, a good is from Canada if the good is harvested in Canada.

(f) CSQ-JP7 shall be established outside the tariff-rate quota in Japan's Schedule to the WTO Agreement and shall be administered by MAFF, or its successor, as a State Trading Enterprise using a SBS mechanism.

(g) For the purposes of CSQ-JP7, maximum import mark-up to set the minimum selling price means the maximum amount that MAFF, or its successor, may add to the amount paid for goods when it sets the minimum selling price at or above which MAFF, or its successor, shall not reject a bid in an SBS tender unless the tender amount in the SBS tender is fully subscribed through higher bids.

(h) The difference between the amount paid by the purchaser in an SBS transaction for goods and the amount paid by MAFF, or its successor, for the goods shall be retained by MAFF, or its successor, as the import mark-up for the goods, which can be more than the maximum import mark-up to set the minimum selling price but shall not exceed the amount permitted for the goods under Japan's Schedule to the WTO Agreement.

8. CSQ-JP8: Malt, Not Roasted for the United States

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from the United States that shall be duty-free in a particular year is specified below:

For Year 7 and for each subsequent year, the aggregate quota quantity shall remain at 32,000 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from the United States imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 110710.029.

(d) For the purposes of CSQ-JP8, a good is from the United States if the good is produced in the United States from barley harvested in the United States.

(e) CSQ-JP8 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

9. CSQ-JP9: Malt, Not Roasted for Australia

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from Australia that shall be duty-free in a particular year is specified below:

(i) 72,000 metric tonnes for Year 1; and

(ii) 72,000 metric tonnes for Year 2 and for each subsequent year.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from Australia imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 110710.029.

(d) For the purposes of CSQ-JP9, a good is from Australia if the good is produced in Australia from barley harvested in Australia.

(e) CSQ-JP9 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

(f) (i) From the date of entry into force of this Agreement for Japan and Australia until the following March 31, notwithstanding subparagraph (a)(i), the aggregate quota quantity of the originating goods from Australia under this Agreement shall be:

(A) where the quota quantity of the originating goods from Australia under this Agreement at the time of entry into force of this Agreement for Japan and Australia calculated in accordance with paragraph 2 of Article 2.30 (Allocation) exceeds the aggregate quota quantity of the originating goods from Australia under the Agreement between Japan and Australia for an Economic Partnership (JAEPA), as defined in subparagraph (o) of Article 1.2 of the JAEPA, which are classified under tariff line 1107.10 for the year concerned, the aggregate quota quantity of the originating goods from Australia under the JAEPA shall be counted toward the aggregate quota quantity of the originating goods from Australia under this Agreement; and

(B) where the quota quantity of the originating goods from Australia under this Agreement at the time of entry into force of this Agreement for Japan and Australia calculated in accordance with paragraph 2 of Article 2.30 (Allocation) does not exceed the aggregate quota quantity of the originating goods from Australia under the JAEPA, as defined in subparagraph (o) of Article 1.2 of the JAEPA, which are classified under tariff line 1107.10 for the year concerned, the aggregate quota quantity under this Agreement shall be zero, and the in-quota rate of customs duty set out in subparagraph (a) shall not apply.

(ii) From April 1 of Year 2 until March 31 of 2023, the aggregate quota quantity of the originating goods from Australia under the JAEPA shall be counted toward the aggregate quota quantity of the originating goods from Australia under this Agreement.

(iii) From April 1 of 2023, notwithstanding subparagraph (a)(ii), the aggregate quota quantity under this Agreement shall be zero, and the in-quota rate set out in subparagraph (a) shall not apply.

10. CSQ-JP10: Malt, Not Roasted for Canada

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from Canada that shall be duty-free in a particular year is specified below:

For Year 2 and for each subsequent year, the aggregate quota quantity shall remain at 89,000 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from Canada imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 110710.029.

(d) For the purposes of CSQ-JP10, a good is from Canada if the good is produced in Canada from barley harvested in Canada.

(e) CSQ-JP10 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

11. CSQ-JP11: Malt, Roasted for the United States

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from the United States that shall be duty-free in a particular year is specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 1,050 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from the United States imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 110720.020.

(d) For the purposes of CSQ-JP11, a good is from the United States if the good is produced in the United States from barley harvested in the United States.

(e) CSQ-JP11 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

12. CSQ-JP12: Malt, Roasted for Australia

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from Australia that shall be duty-free in a particular year is specified below:

For Year 2 and for each subsequent year, the aggregate quota quantity shall remain at 3,000 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from Australia imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 110720.020.

(d) For the purposes of CSQ-JP12, a good is from Australia if the good is produced in Australia from barley harvested in Australia.

(e) CSQ-JP12 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

13. CSQ-JP13: Malt, Roasted for Canada

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from Canada that shall be duty-free in a particular year is specified below:

For Year 2 and for each subsequent year, the aggregate quota quantity shall remain at 4,000 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from Canada imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 110720.020.

(d) For the purposes of CSQ-JP13, a good is from Canada if the good is produced in Canada from barley harvested in Canada.

(e) CSQ-JP13 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

14. CSQ-JP14: Processed Cheese for the United States

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from the United States and the in-quota rate of customs duty in a particular year are specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 150 metric tonnes. For Year 12 and for each subsequent year, the in-quota rate of customs duty shall remain at zero.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from the United States imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 040630.000.

(d) (i) For the purposes of CSQ-JP14, a good is from the United States if the good is produced in the United States and any materials classified in HS Chapter 4 used in the production of the good are produced exclusively in the United States.

(ii) Notwithstanding subparagraph (i), a good that contains materials classified in HS Chapter 4 from a non-Party or a Party other than Japan and the United States shall be treated nonetheless as a good from the United States if the value of these materials does not exceed 10 per cent of the value of the good.

(e) CSQ-JP14 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

15. CSQ-JP15: Processed Cheese for Australia

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from Australia and the in quota rate of customs duty in a particular year are specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 150 metric tonnes. For Year 12 and for each subsequent year, the in-quota rate of customs duty shall remain at zero.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from Australia imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 040630.000.

(d) (i) For the purposes of CSQ-JP15, a good is from Australia if the good is produced in Australia and any materials classified in HS Chapter 4 used in the production of the good are produced exclusively in Australia.

(ii) Notwithstanding subparagraph (i), a good that contains materials classified in HS Chapter 4 from a non-Party or a Party other than Japan and Australia shall be treated nonetheless as a good from Australia if the value of these materials does not exceed 10 per cent of the value of the good.

(e) CSQ-JP15 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

16. CSQ-JP16: Processed Cheese for New Zealand

(a) The aggregate quota quantity of originating goods provided for in the tariff item set out in subparagraph (c) from New Zealand and the in-quota rate of customs duty in a particular year are specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 150 metric tonnes. For Year 12 and for each subsequent year, the in-quota rate of customs duty shall remain at zero.

(b) The rate of customs duty on originating goods provided for in the tariff item set out in subparagraph (c) from New Zealand imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff item 040630.000.

(d) (i) For the purposes of CSQ-JP16, a good is from New Zealand if the good is produced in New Zealand and any materials classified in HS Chapter 4 used in the production of the good are produced exclusively in New Zealand.

(ii) Notwithstanding subparagraph (i), a good that contains materials classified in HS Chapter 4 from a non-Party or a Party other than Japan and New Zealand shall be treated nonetheless as a good from New Zealand if the value of these materials does not exceed 10 per cent of the value of the good.

(e) CSQ-JP16 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

17. CSQ-JP17: Whey (Mineral Concentrate for the United States)

(a) The in-quota rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the United States shall be reduced as follows, when:

(i) the aggregate volume of imports of the originating goods from the United States in any year does not exceed the aggregate quota quantity specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 4,000 metric tonnes. For Year 12 and for each subsequent year, the in-quota rate of customs duty shall remain at zero; and

(ii) the ash content of the originating goods are more than or equal to 11 per cent.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the United States imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category JPB16** and JPB16*** for the originating goods containing a milk protein content of less than 25 per cent, JPB21* and JPB21** for the originating goods containing a milk protein content equal to or greater than 25 per cent but less than 45 per cent, or JPB6**** and JPB6***** for the originating goods containing a milk protein content equal to or greater than 45 per cent as set out in paragraphs 4(dd), 4(ee), 4(gg), 4(hh), 4(h) and 4(i) respectively of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 040410.129 and 040410.169.

(d) For the purposes of CSQ-JP17, a good is from the United States if the good is produced in the United States and any materials classified in HS Chapter 4 used in the production of the good are produced exclusively in the United States.

(e) CSQ-JP17 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

18. CSQ-JP18: Whey (Mineral Concentrate for Australia)

(a) The in-quota rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from Australia shall be eliminated as follows, when:

(i) the aggregate volume of imports of the originating goods from Australia in any year does not exceed the aggregate

quota quantity specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 5,000 metric tonnes. For Year 12 and for each subsequent year, the in-quota rate of customs duty shall remain at zero; and

(ii) the ash content of the originating goods are more than or equal to 11 per cent.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from Australia imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category JPB16** and JPB16*** for the originating goods containing a milk protein content of less than 25 per cent, JPB21* and JPB21** for the originating goods containing a milk protein content equal to or greater than 25 per cent but less than 45 per cent, or JPB6**** and JPB6***** for the originating goods containing a milk protein content equal to or greater than 45 per cent as set out in paragraphs 4(dd), 4(ee), 4(gg), 4(hh), 4(h) and 4(i) respectively of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 040410.129 and 040410.169.

(d) For the purposes of CSQ-JP18, a good is from Australia if the good is produced in Australia and any materials classified in HS Chapter 4 used in the production of the good are exclusively produced in Australia.

(e) CSQ-JP18 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

19. CSQ-JP19: Whey (Prepared Whey for Infant Formula for the United States)

(a) The in-quota rate of customs duty for originating goods provided for in the tariff items set out in subparagraph (c) from the United States shall be duty-free, when:

(i) the aggregate volume of imports of the originating goods from the United States in any year does not exceed the aggregate quota quantity specified below:

For Year 2 and for each subsequent year, the aggregate quota quantity shall remain at 3,000 metric tonnes; and

(ii) the originating goods are whey and products consisting of natural milk constitutions, used for the manufacture of prepared milk powder for babies and infants.

(b) The rate of customs duty on originating goods provided for in the tariff items 040410.149 and 040410.189 from the United States imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category JPB16** and JPB16*** for the originating goods containing a milk protein content of less than 25 per cent, JPB21* and JPB21** for the originating goods containing a milk protein content equal to or greater than 25 per cent but less than 45 per cent, JPB6**** and JPB6***** for the originating goods containing a milk protein content equal to or greater than 45 per cent or EIF for the originating goods for manufacturing mixed feeds containing added colouring matter, as set out in paragraphs 4(dd), 4(ee), 4(gg), 4(hh), 4(h), 4(i) and 4(a) respectively of the General Notes of the Tariff Schedule of Japan. The rate of customs duty on originating goods provided for in the tariff items 040490.118, 040490.128 and 040490.138 from the United States imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4 (kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 040410.149, 040410.189, 040490.118, 040490.128 and 040490.138.

(d) For the purposes of CSQ-JP19, a good is from the United States if the good is produced in the United States and any materials classified in HS Chapter 4 used in the production of the good are produced exclusively in the United States.

(e) CSQ-JP19 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

20. CSQ-JP20: Whey Permeate for the United States

(a) The in-quota rate of customs duty for originating goods provided for in the tariff items set out in subparagraph (c) from the United States shall be duty-free, when:

(i) the aggregate volume of imports of the originating goods from the United States in any year does not exceed the aggregate quota quantity specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 2,000 metric tonnes; and

(ii) the originating goods are whey permeate with protein content less than 5 per cent.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the United States imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category JPB16** and JPB16*** for the originating goods containing a milk protein content of less than 25 per cent, JPB21* and JPB21** for the originating goods containing a milk protein content equal to or greater than 25 per cent but less than 45 per cent, JPB6**** and JPB6***** for the originating goods containing a milk protein equal to or greater than 45 per cent or EIF for the originating goods for manufacturing mixed feeds containing added colouring matter, as set out in paragraphs 4(dd), 4(ee), 4(gg), 4(hh), 4(h), 4(i) and 4(a) respectively of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 040410.149 and 040410.139.

(d) For the purposes of CSQ-JP20, a good is from the United States if the good is produced in the United States and any materials classified in HS Chapter 4 used in the production of the good are produced exclusively in the United States.

(e) CSQ-JP20 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

21. CSQ-JP21: Whey for New Zealand

(a) The in-quota rate of customs duty on originating goods provided for in the tariff items 040410.139, 040410.149, 040410.189, 040490.118, 040490.128 and 040490.138 from New Zealand shall be duty-free. The in-quota rate of customs duty on originating goods classified under the tariff lines 040410.129 and 040410.169 from New Zealand shall be reduced as follows:

For Year 12 and for each subsequent year, the in-quota rate of customs duty shall remain at zero.

(b) The in-quota rate of customs duty set out in subparagraph (a) shall be applied when:

(i) the aggregate volume of imports of the originating goods from New Zealand in any year does not exceed the aggregate quota quantity specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 1,700 metric tonnes; and

(ii) the following condition is met:

(A) the ash content of the originating goods provided for in the tariff items 040410.129 and 040410.169 are more than or equal to 11 per cent;

(B) the originating goods provided for in the tariff items 040410.149, 040410.189, 040490.118, 040490.128 and 040490.138 are whey and products consisting of natural milk constitutions, used for the manufacture of prepared milk powder for babies and infants; or

(C) the originating goods provided for in the tariff items 040410.139 and 040410.149 are whey permeate with protein content less than five per cent.

(c) The rate of customs duty on originating goods provided for in the tariff items 040410.129, 040410.139, 040410.149, 040410.169 and 040410.189 from New Zealand imported in excess of the aggregate quota quantity set out in subparagraph (b) shall be determined in accordance with staging category JPB16** and JPB16*** for the originating goods containing a milk protein content of less than 25 per cent, JPB21* and JPB21** for the originating goods containing a milk protein content equal to or greater than 25 per cent but less than 45 per cent, JPB6**** and JPB6***** for the originating goods containing a milk protein content equal to or greater than 45 per cent or EIF for the originating goods for manufacturing mixed feeds containing added colouring matter, as set out in paragraphs 4(dd), 4(ee), 4(gg), 4(hh), 4(h), 4(i) and 4(a) respectively of the General Notes of the Tariff Schedule of Japan. The rate of customs duty on originating goods provided for in the tariff items 040490.118, 040490.128 and 040490.138 from New Zealand imported in excess of the aggregate quota quantity set out in subparagraph (b) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(d) Subparagraphs (a), (b) and (c) shall apply to the originating goods provided for in the tariff items 040410.129, 040410.139, 040410.149, 040410.169, 040410.189, 040490.118, 040490.128 and 040490.138.

(e) For the purposes of CSQ-JP21, a good is from New Zealand if the good is produced in New Zealand and any materials classified in HS Chapter 4 used in the production of the good are exclusively produced in New Zealand.

(f) CSQ-JP21 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

22. CSQ-JP22: Glucose and Fructose for the United States

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (d) from the United States in a particular year is specified below:

For Year 12 and for each subsequent year, the aggregate quota quantity shall remain at 1,350 metric tonnes.

(b) (i) The in-quota rate of customs duty on originating goods provided for in the tariff items set out in subparagraph

(d)(i) from the United States shall be duty-free.

(ii) The in-quota rate of customs duty other than the levy on originating goods provided for in the tariff items set out in subparagraph (d)(ii) from the United States shall be 21.5 yen per each kilogramme of the sugar portion of those originating goods, on which Japan may charge a levy. The rate of that levy shall be no greater than that of a levy applicable at the time of importation on originating goods provided for in the tariff item 170199.200. The sugar portion of those originating goods provided for in the tariff items set out in subparagraph (d)(ii) from the United States shall be determined by the weight of sucrose (dry matter basis), contained in those originating goods.

(c) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (d) from the United States imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(d) (i) Subparagraphs (a), (b)(i) and (c) shall apply to the originating goods provided for in the tariff items 170230.221, 170230.229, 170240.220, 170260.220 and 170290.529.

(ii) Subparagraphs (a), (b)(ii) and (c) shall apply to the originating goods provided for in the tariff items 170230.210, 170240.210 and 170260.210.

(e) For the purposes of CSQ-JP22, a good is from the United States if the good is produced in the United States and any materials classified in HS Chapter 17 used in the production of the good are produced exclusively in the United States.

(f) CSQ-JP22 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.

23. CSQ-JP23: Corn and Potato Starch for the United States

(a) The aggregate quota quantity of originating goods provided for in the tariff items set out in subparagraph (c) from the United States that shall be duty-free, subject to levy of up to 25 per cent if the originating goods are starch for manufacturing starch sugar, dextrin, dextrin glue, dissolve starch, roasted starch or starch glue, and free from levy if the originating goods are starch for the other purposes than manufacturing starch sugar, dextrin, dextrin glue, dissolve starch, roasted starch or starch glue, in a particular year is specified below.

For Year 7 and for each subsequent year, the aggregate quota quantity shall remain at 3,250 metric tonnes.

(b) The rate of customs duty on originating goods provided for in the tariff items set out in subparagraph (c) from the United States imported in excess of the aggregate quota quantity set out in subparagraph (a) shall be determined in accordance with staging category MFN as set out in paragraph 4(kkk) of the General Notes of the Tariff Schedule of Japan.

(c) Subparagraphs (a) and (b) shall apply to the originating goods provided for in the tariff items 110812.090 and 110813.090.

(d) For the purposes of CSQ-JP23, a good is from the United States if the good is produced in the United States from corn or potatoes harvested in the United States.

(e) CSQ-JP23 shall be administered by Japan through a first-come, first-served import licensing procedure pursuant to which a certificate of tariff rate quota shall be issued by Japan.


APPENDIX B-1

AGRICULTURAL SAFEGUARD MEASURES

Section A: Notes for Appendix B-1

1. This Appendix sets out:

(a) the originating agricultural goods that may be subject to agricultural safeguard measures under paragraph 5 of the General Notes of the Tariff Schedule of Japan;

(b) the trigger levels for applying such measures; and

(c) the maximum rate of customs duty that may be applied in each year for each such good.

2. Notwithstanding Article 2.4 (Elimination of Customs Duties), Japan may apply a safeguard measure on specific originating agricultural goods provided for in the tariff items indicated with "SG1*", "SG1**", "SG2", "SG3", "SG4*", "SG4**", "SG5" or "SG6" in Column "Remarks" in Tariff Schedule of Japan. Japan may apply such a safeguard measure only under the conditions set out in this Appendix and only in accordance with the terms set out in this Appendix, including this Notes.

3. If the conditions specified in this Appendix have been satisfied, Japan may, as an agricultural safeguard measure, increase the rate of customs duty on such an originating agricultural good to a level not to exceed the lesser of:

(a) the most-favoured-nation applied rate of customs duty in effect at the time the agricultural safeguard measure is applied;

(b) the most-favoured-nation applied rate of customs duty in effect on the day immediately preceding the date of entry into force of this Agreement:

(i) for Japan, when the agricultural safeguard measure applies to originating agricultural goods from all the other Parties; and

(ii) with respect to Japan and the Party for which the agricultural safeguard measure applies, when an agricultural safeguard measure applies only to originating agricultural goods from that one Party; and

(c) the rate of customs duty set out in this Appendix.

4. Japan shall implement any agricultural safeguard measure in a transparent manner. Japan shall, within 60 days of the date of imposing the agricultural safeguard measure, notify in writing any other Party whose originating agricultural goods are subject to the measure and provide each such other Party with relevant data concerning the measure. Japan shall, on the written request of any such other Party, respond to specific questions from, and provide information to, that other Party, including by e-mail, teleconference, video-conference and in-person, regarding application of the measure.

5. For the purposes of this Appendix, an originating agricultural good is from the Party if the originating agricultural good is wholly obtained in that Party or if the last change of tariff heading took place in that Party.

6. For greater certainty, no agricultural safeguard measure may be applied or maintained on or after the date on which the rate of customs duty referred to in paragraph 3(c) of this Section is zero.

7. For the purposes of this Appendix:

(a) year means:

(i) with respect to Year 1, the period from the date of entry into force of this Agreement for Japan through the following

March 31; and

(ii) with respect to Year 2 and each subsequent year, the 12-month period from April 1 until the following March 31;

(b) fiscal year means the period from April 1 through the following March 31; and

(c) quarter means a period:

(i) from April 1 through June 30;

(ii) from July 1 through September 30;

(iii) from October 1 through December 31; or

(iv) from January 1 through March 31.

Section B: Agricultural Safeguard Measure for Beef

1. In accordance with paragraph 2 of Section A to this Appendix, with respect to the originating agricultural goods provided for in the tariff items indicated with "SG1*" or "SG1**" in Column "Remarks" in Tariff Schedule of Japan, Japan may apply an agricultural safeguard measure on those originating agricultural goods only when the aggregate volume of imports of those originating agricultural goods from all the other Parties for the year exceeds the trigger level set out as follows:

(a) 590,000 metric tonnes for Year 1, except as provided in paragraph 9;

(b) 601,800 metric tonnes for Year 2;

(c) 613,600 metric tonnes for Year 3;

(d) 625,400 metric tonnes for Year 4;

(e) 637,200 metric tonnes for Year 5;

(f) 649,000 metric tonnes for Year 6;

(g) 660,800 metric tonnes for Year 7;

(h) 672,600 metric tonnes for Year 8;

(i) 684,400 metric tonnes for Year 9;

(j) 696,200 metric tonnes for Year 10;

(k) beginning in Year 11 and running through Year 15, the trigger level for each year shall be 5,900 metric tonnes greater than the trigger level in the previous year; and

(l) beginning in Year 16 and continuing every year thereafter, the trigger level for each year shall be 11,800 metric tonnes greater than the trigger level in the previous year.

2. (a) For the originating agricultural goods provided for in the tariff items indicated with "SG1*", the rate of customs duty referred to in paragraph 3(c) of Section A to this Appendix shall be:

(i) 38.5 per cent, for Year 1 through Year 3;

(ii) 30.0 per cent, for Year 4 through Year 10;

ANNEX 2-D – APPENDIX B-1 – JAPAN – 3

(iii) 20.0 per cent, for Year 11 through Year 14;

(iv) 18.0 per cent, for Year 15; and

(v) beginning in Year 16 and continuing every year thereafter:

(A) one percentage point less than the rate of customs duty in the previous year, if Japan did not apply a safeguard measure under this Section in the previous year; or

(B) the same as the rate of customs duty in the previous year, if Japan applied a safeguard measure under this Section in the previous year.

(b) For the originating agricultural goods provided for in the tariff items indicated with "SG1**", the rate of customs duty referred to in paragraph 3(c) of Section A to this Appendix shall be:

(i) 39.0 per cent, for Year 1;

(ii) 38.5 per cent, for Year 2 and Year 3;

(iii) 32.7 per cent, for Year 4;

(iv) 30.6 per cent, for Year 5;

(v) 30.0 per cent, for Year 6 through Year 10;

(vi) 20.0 per cent, for Year 11 through Year 14;

(vii) 18.0 per cent, for Year 15; and

(viii) beginning in Year 16 and continuing every year thereafter:

(A) one percentage point less than the rate of customs duty in the previous year, if Japan did not apply a safeguard measure under this Section in the previous year; or

(B) the same as the rate of customs duty in the previous year, if Japan applied a safeguard measure under this Section in the previous year.

(c) If the condition set out in paragraph 1 is met in one year and as a result a safeguard measure is in effect during the following year pursuant to paragraph 3(b) or 3(c) of this Section, the rate of customs duty referred to in paragraph 3(c) of Section A to this Appendix for the purpose of that safeguard measure shall, for the duration of that safeguard measure, be at the level applicable for the year in which the condition set out in paragraph 1 is met.

3. An agricultural safeguard measure referred to in paragraph 1 may be maintained:

(a) if the aggregate volume of imports from all the other Parties of the originating agricultural goods provided for in the tariff items indicated with "SG1*" or "SG1**" in any fiscal year exceeds the trigger level set out in paragraph 1 prior to 31 January, until the end of that fiscal year;

(b) if the aggregate volume of imports from all the other Parties of the originating agricultural goods provided for in the tariff items indicated with "SG1*" or "SG1**" in any fiscal year exceeds the trigger level set out in paragraph 1 during the month of February, for 45 days beginning from the day of the application of the agricultural safeguard measure; and

(c) if the aggregate volume of imports from all the other Parties of the originating agricultural goods provided for in the tariff items indicated with "SG1*" or "SG1**" in any fiscal year exceeds the trigger level set out in paragraph 1 during the month of March, for 30 days beginning from the day of the application of the agricultural safeguard measure.

4. (a) For the purposes of this Section, the period during which an agricultural safeguard measure may be maintained shall commence no later than the day following the fifth business day after the end of the publication period in which the aggregate quantity of imports of the agricultural originating goods exceeded the trigger level set out in paragraph 1.

(b) For the purposes of this Section, as an exceptional measure taken for the implementation of this Section, within five business days after the end of each publication period, the customs administration of Japan shall publish the aggregate volume of imports of the originating agricultural goods provided for in the tariff items indicated with "SG1*" or "SG1**" in Column "Remarks" of the Tariff Schedule of Japan from all the other Parties between:

(i) the beginning of the fiscal year and the end of the publication period; and

(ii) for Year 11 through Year 15, the beginning of the quarter and the end of the publication period.

(c) For the purposes of this Section, publication period means:

(i) the period from the first day of each month until the 10th day of that month;

(ii) the period from the 11th day of each month until the 20th day of that month; and

(iii) the period from the 21st day of each month until the final day of that month.

5. (a) Notwithstanding paragraph 1, if, during any year from Year 11 through Year 15, the aggregate volume of imports of the originating agricultural goods provided for in the tariff items indicated with "SG1*" or "SG1**" in Column "Remarks" of the Tariff Schedule of Japan from all the other Parties in any quarter exceeds the quarterly safeguard trigger volume set out in subparagraph (b), Japan may increase the rates of customs duties for such goods in accordance with paragraph 3 of Section A to this Appendix for a period of 90 days. The 90-day period shall commence no later than the day following the fifth business day after the end of the publication period in which the aggregate quantity of imports of such goods in the quarter exceeded the quarterly safeguard trigger volume. The rate of customs duty referred to in paragraph 3(c) of Section A to this Appendix if the condition set out in this paragraph is met shall be:

(i) 20.0 per cent, if the condition is met during Year 11 through Year 14; and

(ii) 18.0 per cent, if the condition is met in Year 15.

(b) For the purposes of this paragraph, the quarterly safeguard trigger volume means 117 per cent of one fourth of the trigger level set out in paragraph 1(k) for the respective year.

(c) Notwithstanding paragraph 1, if during any year from Year 11 through Year 15, the aggregate volume of imports of the originating agricultural goods provided for in the tariff items indicated with "SG1*" or "SG1**" in Column "Remarks" of the Tariff Schedule of Japan from all the other Parties exceeds the trigger level set out in paragraph 1(k) for the respective year, and at the same time the aggregate volume of imports of the originating agricultural goods provided for in those tariff items from all the other Parties in the quarter exceeds the quarterly safeguard trigger volume set out in subparagraph (b), Japan may maintain an agricultural safeguard measure under this Section until the later of the end of the 90-day period provided for in subparagraph (a) or the date provided for in paragraph 3.

6. If, during any four consecutive fiscal years after Year 15, Japan does not apply an agricultural safeguard measure under this Section, Japan shall not apply any further agricultural safeguard measures under this Section.

7. When the importation into Japan from any Party of the originating agricultural goods provided for in the tariff items indicated with "SG1*" or "SG1**" in Column "Remarks" of the Tariff Schedule of Japan has been wholly or substantially suspended for more than three years due to sanitary concerns, Japan shall not apply an agricultural safeguard measure under this Section to such goods from that Party for four years after the whole or substantial lifting of the suspension. If a natural disaster such as severe drought disrupts the recovery of production in the Party whose imports had been suspended, the period in which Japan shall not apply an agricultural safeguard measure under this Section to such goods from that Party shall be five years.

8. Japan shall not apply the tariff emergency measures on beef referred to in Article 7.5 of the Temporary Tariff Measures Law of Japan (Law No.36 of 1960) to the originating agricultural goods provided for in the tariff items indicated with "SG1*" in Column "Remarks" of the Tariff Schedule of Japan.

9. If Year 1 is less than 12 months, the applicable trigger level for Year 1 for the purposes of paragraph 1(a) shall be determined by multiplying 590,000 metric tonnes by a fraction the numerator of which shall be the number of months between the date of entry into force of this Agreement for Japan and the following March 31 and the denominator of which shall be 12. For the purpose of determining the numerator specified in the previous sentence and for the purpose of determining the applicable trigger level in accordance with the previous sentence, any fraction of less than 1.0 shall be rounded to the nearest whole number (in the case of 0.5, the fraction shall be rounded to 1.0).

10. (a) The aggregate volume of imports into Japan of the originating goods, as defined in subparagraph (o) of Article 1.2 of the Agreement between Japan and Australia for an Economic Partnership (JAEPA) (hereinafter referred to as "JAEPA originating goods"), which are classified under headings 02.01 and 02.02 under the JAEPA, shall be counted towards the aggregate volume of imports of the originating agricultural goods under this Agreement which are classified under the same tariff lines under this Agreement, in determining whether the aggregate volume of imports of the originating agricultural goods under this Agreement exceeds the corresponding levels or volumes set out in paragraphs 1 and 5(b) of this Section.

(b) For greater certainty, when the aggregate volume of imports from Australia of JAEPA originating goods classified under headings 02.01 and 02.02 under the JAEPA has exceeded the levels set out in subparagraphs 3.(a)(i) and (ii) of Section 1 (Notes for Schedule of Japan) of Part 3 of Annex 1 of the JAEPA, but the aggregate volume of imports of originating agricultural goods provided for in the tariff items indicated with "SG1*" or "SG1**" in Column "Remarks" of the Tariff Schedule of Japan under this Agreement has not exceeded the levels or volumes set out in paragraph 1 and 5(b) of this Section, further imports of the originating agricultural goods from Australia under this Agreement shall be subject to the rate of customs duty which is determined in accordance with the Tariff Schedule of Japan.

(c) For greater certainty, when the aggregate volume of imports of originating agricultural goods provided for in the tariff items indicated with "SG1*" or "SG1**" in Column "Remarks" of the Tariff Schedule of Japan under this Agreement has exceeded the levels or volumes set out in paragraph 1 and 5(b) of this Section and the aggregate volume of imports of JAEPA originating goods classified under headings 02.01 and 02.02 under the JAEPA has exceeded the levels set out in subparagraphs 3.(a)(i) and (ii) of Section 1 (Notes for Schedule of Japan) of Part 3 of Annex 1 of the JAEPA, then imports of the originating agricultural goods from Australia under this Agreement shall be subject to the rate of customs duty which is determined in accordance with this Section.

11. (a) In implementing the commitment on originating agricultural goods classified under headings 02.01 and 02.02, provided for in the Tariff Schedule of Japan, Japan and Australia agree that, notwithstanding subparagraphs 3.(a)(i) and (ii) of Section 1 (Notes for Schedule of Japan) of Part 3 of Annex 1 of the JAEPA, the aggregate volume of imports of the originating agricultural goods classified under headings 02.01 and 02.02 from Australia under this Agreement shall be counted towards the aggregate volume of imports of the JAEPA originating goods, which are classified under the same tariff lines under the JAEPA, in determining whether the aggregate volume of those JAEPA originating goods exceeds the level set out in subparagraphs 3.(a)(i) and (ii) of Section 1 (Notes for Schedule of Japan) of Part 3 of Annex 1 of the JAEPA.

(b) For the purposes of ensuring the appropriate functioning of special safeguard measures under subparagraphs 3.(a)(i) and (ii) of Section 1 (Notes for Schedule of Japan) of Part 3 of Annex 1 of the JAEPA to avoid a sudden increase in total import of the originating goods as defined in subparagraph (o) of Article 1.2 of the JAEPA which are classified under headings 02.01 and 02.02 under the JAEPA, on request of a Party which imports such originating goods, the requested Party and the requesting Party shall hold a consultation on the application of subparagraph (a).

(c) For greater certainty, when the aggregate volume of imports of originating agricultural goods provided for in the tariff items indicated with "SG1*" or "SG1**" in Column "Remarks" of the Tariff Schedule of Japan under this Agreement has exceeded the levels or volumes set out in paragraphs 1 and 5(b) of this Section, but the aggregate volume of imports from Australia of JAEPA originating goods classified under headings 02.01 and 02.02 under the JAEPA has not exceeded the levels set out in subparagraphs 3.(a)(i) and (ii) of Section 1 (Notes for Schedule of Japan) of Part 3 of Annex 1 of the JAEPA, further imports of the JAEPA originating goods from Australia under the JAEPA shall be subject to the rate of customs duty which is determined in accordance with Section 1 (Notes for Schedule of Japan) of Part 3 of Annex 1 of the JAEPA.

Section C: Agricultural Safeguard Measure for Pork

1. In accordance with paragraph 2 of Section A to this Appendix, with respect to the originating agricultural goods provided for in the tariff items indicated with "SG2" in Column "Remarks" in the Tariff Schedule of Japan (SG2 goods), Japan may apply an agricultural safeguard measure only when the following conditions are met, except as provided in paragraphs 6 and 7 of this Section:

(a) in Year 1 and Year 2, except as provided in paragraph 6 of this Section, Japan may apply an agricultural safeguard measure under this Section on SG2 goods from an individual Party if the aggregate volume of imports of SG2 goods from that individual Party for the respective year exceeds 112 per cent of the largest annual aggregate volume of imports of SG2 goods from that individual Party during any of the preceding three fiscal years;

(b) in Year 3 and Year 4, Japan may apply an agricultural safeguard measure under this Section on SG2 goods from an individual Party if the aggregate volume of imports of SG2 goods from that individual Party for the respective year exceeds 116 per cent of the largest annual aggregate volume of imports of SG2 goods from that individual Party during any of the preceding three fiscal years;

(c) in Year 5 and Year 6:

(i) Japan may apply an agricultural safeguard measure under this Section on SG2 goods from an individual Party imported at a price equal to or greater than the threshold price for those SG2 goods, if the aggregate volume of imports of those SG2 goods from that individual Party for the respective year exceeds 116 per cent of the largest annual aggregate volume of imports of those SG2 goods from that individual Party during any of the preceding three fiscal years; or

(ii) Japan may apply an agricultural safeguard measure under this Section on SG2 goods from all the other Parties imported at a price less than the threshold price for those SG2 goods, if the aggregate volume of imports of those SG2 goods from all the other Parties for the respective year exceeds:

(A) in Year 5: 90,000 metric tonnes; and

(B) in Year 6: 102,000 metric tonnes;

(d) in Year 7 through Year 11:

(i) Japan may apply an agricultural safeguard measure under this Section on SG2 goods from an individual Party imported at price equal to or greater than the threshold price for those SG2 goods, if the aggregate volume of imports of those SG2 goods from that Party for the respective year exceeds 119 per cent of the largest annual aggregate volume of imports of those SG2 goods from that Party during any of the preceding three fiscal years; or

(ii) Japan may apply an agricultural safeguard measure under this Section on SG2 goods from all the other Parties imported at price less than the threshold price for those SG2 goods, if the aggregate volume of imports of those SG2 goods from all the other Parties for the respective year exceeds:

(A) in Year 7: 114,000 metric tonnes;

(B) in Year 8: 126,000 metric tonnes;

(C) in Year 9: 138,000 metric tonnes;

(D) in Year 10: 150,000 metric tonnes; and

(E) in Year 11: 150,000 metric tonnes,

where for the purposes of subparagraphs (c) and (d), threshold price means:

(iii) for the originating agricultural goods provided for in the tariff items 020312.021, 020312.023, 020319.021, 020319.023, 020322.021, 020322.023, 020329.021, 020329.023, 020630.092, 020630.093, 020649.092 or 020649.093: 399 yen per kilogramme; and

(iv) for the originating agricultural goods provided for in the tariff items 020311.020, 020311.030, 020321.020 or 020321.030: 299.25 yen per kilogramme.

2. For SG2 goods, the rate of customs duty referred to in paragraph 3(c) of Section A to this Appendix shall be:

(a) for SG2 goods provided for in the tariff items 020311.040, 020312.022, 020319.022, 020321.040, 020322.022, 020329.022 020630.099 or 020649.099:

(i) in Year 1 through Year 3: 4.0 per cent;

(ii) in Year 4 through Year 6: 3.4 per cent;

(iii) in Year 7 through Year 9: 2.8 per cent; and

(iv) in Year 10 and Year 11: 2.2 per cent,

(b) for SG2 goods provided for in the tariff items 020312.021, 020312.023, 020319.021, 020319.023, 020322.021, 020322.023, 020329.021, 020329.023, 020630.092, 020630.093, 020649.092 or 020649.093, the lesser of:

(i) the difference between CIF import price per kilogramme and the First Safeguard Standard Import Price; and

(ii) the first alternative rate, where for the purposes of this subparagraph:

(iii) First Safeguard Standard Import Price means a price equal to 524 yen per kilogramme multiplied by the sum of 100 per cent and the rate of customs duty set out in paragraph 2(a) for the respective year; and

(iv) first alternative rate means:

(A) in Year 1 through Year 4: the rate of customs duty specified in the Tariff Schedule of Japan for the tariff lines 020312.023, 020319.023, 020322.023, 020329.023, 020630.093 or 020649.093;

(B) in Year 5 through Year 9: 100 yen per kilogramme; and

(C) in Year 10 and Year 11: 70 yen per kilogramme; and

(c) for SG2 goods provided for in the tariff items 020311.020, 020311.030, 020321.020 or 020321.030, the lesser of:

(i) the difference between CIF import price per kilogramme and the Second Safeguard Standard Import Price; and

(ii) the second alternative rate, where for the purposes of this subparagraph:

(iii) Second Safeguard Standard Import Price means a price equal to 393 yen per kilogramme multiplied by the sum of 100 per cent and the rate of customs duty set out in paragraph 2(a) for the respective year; and

(iv) second alternative rate means:

(A) in Year 1 through Year 4: the rate of customs duty specified in the Tariff Schedule of Japan for the tariff lines 020311.020 or 020321.020;

(B) in Year 5 through Year 9: 75 yen per kilogramme; and

(C) in Year 10 and Year 11: 52.5 yen per kilogramme.

3. Any agricultural safeguard measure applied under this Section may be maintained only until the end of the fiscal year in which the trigger level was exceeded.

4. Japan shall not apply or maintain any agricultural safeguard measure under this Section after the end of Year 11.

5. Japan shall not apply the tariff emergency measures on pork referred to in paragraph 1 of Article 7.6 of the Temporary Tariff Measures Law of Japan (Law No. 36 of 1960) to SG2 goods.

6. If Year 1 is less than 12 months, the applicable trigger level for SG2 goods from an individual Party for Year 1 for the purposes of paragraph 1(a) shall be determined by multiplying 112 per cent of the largest annual aggregate volume of imports of SG2 goods from that Party during any of the preceding three fiscal years by a fraction the numerator of which shall be the number of months between the date of entry into force of this Agreement for Japan and the following March 31 and the denominator of which shall be 12. For the purpose of determining the numerator specified in the previous sentence and for the purpose of determining the applicable trigger level in accordance with the previous sentence, any fraction of less than 1.0 shall be rounded to the nearest whole number (in the case of 0.5, the fraction shall be rounded to 1.0).

7. If this Agreement enters into force for a Party other than Japan in accordance with Article 30.5.4 and Article 30.5.5 (Entry into Force), and:

(a) the date of entry into force of this Agreement for that Party is not April 1; and

(b) the period between the date of entry into force of this Agreement for that Party and the following March 31 is not Year 1, the applicable trigger level for SG2 goods from that Party for the year for the purposes of paragraph 1 shall be determined by multiplying the trigger level that would be applicable pursuant to paragraph 1 if it were a complete year by a fraction the numerator of which shall be the number of months between the date of entry into force of this Agreement for that Party and the following March 31 and the denominator of which shall be 12. For the purpose of determining the numerator specified in the previous sentence and for the purpose of determining the applicable trigger level in accordance with the previous sentence, any fraction of less than 1.0 shall be rounded to the nearest whole number (in the case of 0.5, the fraction shall be rounded to 1.0).

Section D: Agricultural Safeguard Measure for Processed Pork

1. In accordance with paragraph 2 of Section A to this Appendix, with respect to the originating agricultural goods provided for in the tariff items indicated with "SG3" in Column "Remarks" in the Tariff Schedule of Japan (SG3 goods), Japan may apply an agricultural safeguard measure only when the following conditions are met, except as provided in paragraphs 6 and 7 of this Section:

(a) in Year 1 and Year 2, except as provided in paragraph 6 of this Section, Japan may apply an agricultural safeguard measure under this Section on SG3 goods from an individual Party only if the aggregate volume of imports of SG3 goods from that individual Party for the respective year exceeds 115 per cent of the largest annual aggregate volume of imports of SG3 goods from that Party during any of the preceding three fiscal years;

(b) in Year 3 through Year 6, Japan may apply an agricultural safeguard measure under this Section on SG3 goods from an individual Party only if the aggregate volume of imports of SG3 goods from that other Party for the respective year exceeds 118 per cent of the largest annual aggregate volume of imports of SG3 goods from that individual Party during any of the preceding three fiscal years; and

(c) in Year 7 through Year 11, Japan may apply an agricultural safeguard measure under this Section on SG3 goods from an individual Party only if the aggregate volume of imports of SG3 goods from that other Party for the respective year exceeds 121 per cent of the largest annual aggregate volume of imports of SG3 goods from that individual Party during any of the preceding three fiscal years.

2. (a) For SG3 goods, the rate of customs duty referred to in paragraph 3(c) of Section A to this Appendix shall be:

(i) for Year 1 through Year 4: 85 per cent of the base rate;

(ii) for Year 5 through Year 9: 60 per cent of the base rate; and (iii) for Year 10 and Year 11: 45 per cent of the base rate.

(b) For the purposes of this paragraph, the base rate shall be comprised of an ad valorem duty component and a specific duty component, each of which shall be reduced to the percentages identified in subparagraph (a) to determine the rate of customs duty referred to in paragraph 3(c) of Section A to this Appendix. The ad valorem duty component of the base rate shall be 8.5 per cent, and the specific duty component shall be equal to 614.85 yen per kilogramme minus 60 per cent of the CIF import price per kilogramme of the respective SG3 good.

3. Any agricultural safeguard measure applied under this Section may be maintained only until the end of the fiscal year in which the trigger level was exceeded.

4. Japan shall not apply any agricultural safeguard measure under this Section after the end of Year 11.

5. Japan shall not apply the tariff emergency measures on pork referred to in paragraph 1 of Article 7-6 of the Temporary Tariff Measures Law of Japan (Law No. 36 of 1960) to SG3 goods.

6. If Year 1 is less than 12 months, the applicable trigger level for SG3 goods from an individual Party for Year 1 for the purposes of paragraph 1(a) shall be determined by multiplying 115 per cent of the largest annual aggregate volume of imports of SG3 goods from that Party during any of the preceding three fiscal years by a fraction the numerator of which shall be the number of months between the date of entry into force of this Agreement for Japan and the following March 31 and the denominator of which shall be 12. For the purpose of determining the numerator specified in the previous sentence and for the purpose of determining the applicable trigger level in accordance with the previous sentence, any fraction of less than 1.0 shall be rounded to the nearest whole number (in the case of 0.5, the fraction shall be rounded to 1.0).

7. If this Agreement enters into force for a Party other than Japan in accordance with Article 30.5.4 and Article 30.5.5 (Entry into Force), and:

(a) the date of entry into force of this Agreement for that Party is not April 1; and

(b) the period between the date of entry into force of this Agreement for that Party and the following March 31 is not Year 1, the applicable trigger level for SG3 goods from that Party for the year for the purposes of paragraph 1 shall be determined by multiplying the trigger level that would be applicable pursuant to paragraph 1 if it were a complete year by a fraction the numerator of which shall be the number of months between the date of entry into force of this Agreement for that Party and the following March 31 and the denominator of which shall be 12. For the purpose of determining the numerator specified in the previous sentence and for the purpose of determining the applicable trigger level in accordance with the previous sentence, any fraction of less than 1.0 shall be rounded to the nearest whole number (in the case of 0.5, the fraction shall be rounded to 1.0).

Section E: Agricultural Safeguard Measure for WPC

1. In accordance with paragraph 2 of Section A to this Appendix, with respect to the originating agricultural goods provided for in the tariff items indicated with "SG4*" in Column "Remarks" in the Tariff Schedule of Japan, Japan may apply an agricultural safeguard measure on those originating agricultural goods only when the aggregate volume of imports of those originating agricultural goods from all the other Parties for the year exceeds the trigger level set out as follows:

(a) 4,500 metric tonnes for Year 1, except as provided in paragraph 6;

(b) 4,778 metric tonnes for Year 2;

(c) 5,056 metric tonnes for Year 3;

(d) 5,333 metric tonnes for Year 4;

(e) 5,611 metric tonnes for Year 5;

(f) 5,889 metric tonnes for Year 6;

(g) 6,167 metric tonnes for Year 7;

(h) 6,444 metric tonnes for Year 8;

(i) 6,722 metric tonnes for Year 9;

(j) 7,000 metric tonnes for Year 10;

(k) 7,750 metric tonnes for Year 11;

(l) 8,500 metric tonnes for Year 12;

(m) 9,250 metric tonnes for Year 13;

(n) 10,250 metric tonnes for Year 14;

(o) 11,250 metric tonnes for Year 15;

(p) 12,250 metric tonnes for Year 16;

(q) 13,250 metric tonnes for Year 17;

(r) 14,250 metric tonnes for Year 18;

(s) 15,250 metric tonnes for Year 19;

(t) 16,250 metric tonnes for Year 20; and

(u) beginning in Year 21 and continuing every year thereafter, the trigger level for each year shall be 1,250 metric tonnes greater than the trigger level in the previous year.

2. For the originating agricultural goods provided for in the tariff items indicated with "SG4*", the rate of customs duty referred to in paragraph 3(c) of Section A to this Appendix shall be:

(a) 29.8 per cent plus 120 yen per kilogramme, for Year 1 through Year 5;

(b) 23.8 per cent plus 105 yen per kilogramme, for Year 6 through Year 10;

(c) 19.4 per cent plus 90 yen per kilogramme, for Year 11 through Year 15;

(d) 13.4 per cent plus 75 yen per kilogramme, for Year 16 through Year 20; and

(e) beginning in Year 21 and continuing every year thereafter:

(i) the ad valorem duty component of the rate of customs duty shall be 1.9 per cent lower than it was in the previous year and the specific duty component of the rate of customs duty shall be 10.7 yen per kilogramme lower than it was in the previous year, unless an agricultural safeguard measure set out in this Section was applied in the previous year; or

(ii) the ad valorem duty component of the rate of customs duty shall be 1.0 per cent lower than it was in the previous year and the specific duty component of the rate of customs duty shall be 5.0 yen per kilogramme lower than it was in the previous year if an agricultural safeguard measure set out in this Section was applied in the previous year.

3. Any agricultural safeguard measure applied under this Section may be maintained only until the end of the fiscal year in which the trigger level was exceeded.

4. If, during any three consecutive fiscal years after Year 20, Japan does not apply an agricultural safeguard measure under this Section, Japan shall not apply any further agricultural safeguard measures under this Section.

5. (a) Notwithstanding paragraph 1, Japan shall not apply any agricultural safeguard measure under this Section if:

(i) there is a domestic shortage of skimmed milk powder in Japan; or

(ii) there is no demonstrable reduction in domestic demand for skimmed milk powder in Japan.

(b) If Japan applies an agricultural safeguard measure under this Section when an individual Party whose originating agricultural goods are subject to the measure believes that either of the conditions set out in subparagraph (a) has been satisfied, that Party may:

(i) ask Japan to provide an explanation of why Japan does not consider either of the conditions set out in subparagraph (a) to have been satisfied; and

(ii) request that Japan cease application of the agricultural safeguard measure for the remainder of the fiscal year.

6. If Year 1 is less than 12 months, the applicable trigger level for Year 1 for the purposes of paragraph 1(a) shall be determined by multiplying 4,500 metric tonnes by a fraction the numerator of which shall be the number of months between the date of entry into force of this Agreement for Japan and the following March 31 and the denominator of which shall be 12. For the purpose of determining the numerator specified in the previous sentence and for the purpose of determining the applicable trigger level in accordance with the previous sentence, any fraction of less than 1.0 shall be rounded to the nearest whole number (in the case of 0.5, the fraction shall be rounded to 1.0).

Section F: Agricultural Safeguard Measure for Whey Powder

1. In accordance with paragraph 2 of Section A to this Appendix, with respect to the originating agricultural goods provided for in the tariff items indicated with "SG4**" in Column "Remarks" in the Tariff Schedule of Japan, Japan may apply an agricultural safeguard measure on those originating agricultural goods only when the aggregate volume of imports of those originating agricultural goods from all the other Parties for the year exceeds the trigger level set out as follows:

(a) 5,000 metric tonnes for Year 1, except as provided in paragraph 5;

(b) 5,333 metric tonnes for Year 2;

(c) 5,667 metric tonnes for Year 3;

(d) 6,000 metric tonnes for Year 4;

(e) 6,333 metric tonnes for Year 5;

(f) 6,667 metric tonnes for Year 6;

(g) 7,000 metric tonnes for Year 7;

(h) 7,333 metric tonnes for Year 8;

(i) 7,667 metric tonnes for Year 9;

(j) 8,000 metric tonnes for Year 10;

(k) 8,500 metric tonnes for Year 11;

(l) 9,000 metric tonnes for Year 12;

(m) 9,750 metric tonnes for Year 13;

(n) 10,500 metric tonnes for Year 14;

(o) 11,250 metric tonnes for Year 15; and

(p) beginning in Year 16 and continuing every year thereafter, the trigger level for each year shall be 1,000 metric tonnes greater than the trigger level in the previous year.

2. For the originating agricultural goods provided for in the tariff items indicated with "SG4**", the rate of customs duty referred to in paragraph 3(c) of Section A to this Appendix shall be:

(a) for Year 1 through Year 5, 29.8 per cent plus 75 yen per kilogramme;

(b) for Year 6 through Year 10, 23.8 per cent plus 45 yen per kilogramme;

(c) for Year 11 through Year 15, 13.4 per cent plus 30 yen per kilogramme; and

(d) beginning in Year 16 and continuing every year thereafter:

(i) 2.0 per cent and 4.0 yen per kilogramme lower than it was in the previous year, unless an agricultural safeguard measure set out in this Section was applied in the previous year; or

(ii) 1.0 per cent and 2.0 yen per kilogramme lower than it was in the previous year if an agricultural safeguard measure set out in this Section was applied in the previous year.

3. Any agricultural safeguard measure applied under this Section may be maintained only until the end of the fiscal year in which the trigger level was exceeded.

4. If, during any two consecutive years after Year 15, Japan does not apply an agricultural safeguard measure under this Section, Japan shall not apply any further agricultural safeguard measures under this Section.

5. If Year 1 is less than 12 months, the applicable trigger level for Year 1 for the purposes of paragraph 1(a) shall be determined by multiplying 5,000 metric tonnes by a fraction the numerator of which shall be the number of months between the date of entry into force of this Agreement for Japan and the following March 31 and the denominator of which shall be 12. For the purpose of determining the numerator specified in the previous sentence and for the purpose of determining the applicable trigger level in accordance with the previous sentence, any fraction of less than 1.0 shall be rounded to the nearest whole number (in the case of 0.5, the fraction shall be rounded to 1.0).

Section G: Agricultural Safeguard Measure for Fresh Oranges

1. In accordance with paragraph 2 of Section A to this Appendix, with respect to the originating agricultural goods provided for in the tariff items indicated with "SG5" in Column "Remarks" in the Tariff Schedule of Japan, Japan may apply an agricultural safeguard measure on those originating agricultural goods only when the aggregate volume of imports of those originating agricultural goods from all the other Parties between December 1 and March 31 for the fiscal year exceeds the level set out as follows:

(a) 35,000 metric tonnes for Year 1, except as provided in paragraph 5;

(b) 37,000 metric tonnes for Year 2;

(c) 39,000 metric tonnes for Year 3;

(d) 41,000 metric tonnes for Year 4;

(e) 43,000 metric tonnes for Year 5;

(f) 45,000 metric tonnes for Year 6; and

(g) 47,000 metric tonnes for Year 7.

2. For the originating agricultural goods provided for in the tariff items indicated with "SG5", the rate of customs duty referred to in paragraph 3(c) of Section A to this Appendix shall be:

(a) for Year 1 through Year 4: 28 per cent; and

(b) for Year 5 through Year 7: 20 per cent.

3. Any agricultural safeguard measure applied under this Section may be maintained only until the end of the fiscal year in which the trigger level was exceeded.

4. Japan shall not apply any safeguard measure under this Section after the end of Year 7.

5. If Year 1 is less than 4 months, the applicable trigger level for Year 1 for the purposes of paragraph 1(a) shall be determined by multiplying 35,000 metric tonnes by a fraction the numerator of which shall be the number of months between the date of entry into force of the Agreement for Japan and the following March 31 and the denominator of which shall be four. For the purpose of determining the numerator specified in the previous sentence and for the purpose of determining the applicable trigger level in accordance with the previous sentence, any fraction of less than 1.0 shall be rounded to the nearest whole number (in the case of 0.5, the fraction shall be rounded to 1.0).

Section H: Agricultural Safeguard Measure for Race Horses

1. In accordance with paragraph 2 of Section A to this Appendix, with respect to the originating agricultural goods provided for in the tariff items indicated with "SG6" in Column "Remarks" of the Tariff Schedule of Japan, Japan may apply an agricultural safeguard measure on those originating agricultural goods only if the CIF import price per each of those originating agricultural goods, expressed in Japanese Yen, is less than 90 per cent of the trigger price. The trigger price shall be the price that has been agreed in accordance with paragraph 4, or 8.5 million yen if there has been no specific agreement on the trigger price in accordance with paragraph 4.

2. For the originating agricultural goods provided for in the tariff items indicated with "SG6", the rate of customs duty referred to in paragraph 3(c) of Section A to this Appendix shall be the rate of customs duty determined for those originating agricultural goods in accordance with staging category B16 identified in the Tariff Schedule of Japan plus:

(a) if the difference between the CIF import price per each of the originating agricultural good and the trigger price is greater than 10 per cent but less than or equal to 40 per cent of the trigger price: 30 per cent of the difference between the most-favoured-nation applied rate of customs duty in effect at the time of importation and the rate of customs duty applied to the originating agricultural goods in accordance with the staging category B16 identified in the Tariff Schedule of Japan;

(b) if the difference between the CIF import price per each of the originating agricultural good and the trigger price is greater than 40 per cent but less than or equal to 60 per cent of the trigger price: 50 per cent of the difference between the most-favoured-nation applied rate of customs duty in effect at the time of importation and the rate of customs duty applied to the originating agricultural goods in accordance with the staging category B16 identified in the Tariff Schedule of Japan;

(c) if the difference between the CIF import price per each of the originating agricultural good and the trigger price is greater than 60 per cent but less than or equal to 75 per cent of the trigger price: 70 per cent of the difference between the most-favoured-nation applied rate of customs duty in effect at the time of importation and the rate of customs duty applied to the originating agricultural goods in accordance with the staging category B16 identified in the Tariff Schedule of Japan; and

(d) if the difference between the CIF import price per each of the originating agricultural good and the trigger price is greater than 75 per cent of the trigger price: the difference between the most-favoured-nation applied rate of customs duty in effect at the time of importation and the rate of customs duty applied to the originating agricultural goods in accordance with the staging category B16 identified in the Tariff Schedule of Japan.

3. Japan shall not apply any safeguard measure under this Section after the end of Year 15.

4. On request of a Party, and following notification of such request to all the other Parties, Japan and those Parties interested in consulting shall consult on the operation of the safeguard measure set out in this Section and may mutually agree to periodically evaluate and update the trigger price.


APPENDIX B-2

FOREST GOOD SAFEGUARD MEASURE

1. Notwithstanding Article 2.4 (Elimination of Customs Duties), pursuant to paragraph 5 of the General Notes of the Tariff Schedule of Japan, Japan may apply a safeguard measure on specific forest goods qualified as "originating forest goods" provided for in the tariff items indicated with "SG11", "SG12", "SG13", "SG14", "SG15", "SG16" or "SG17" in Column "Remarks" in the Tariff Schedule of Japan, only when the conditions set out in this Appendix are met.

2. If the conditions in any one of paragraphs 6 through 12 have been satisfied, Japan may, as a forest good safeguard measure, increase the rate of customs duty on an originating forest good from another Party to a level not to exceed the lesser of:

(a) the most-favoured-nation applied rate of customs duty in effect at the time the forest good safeguard measure is applied; and

(b) the most-favoured-nation applied rate of customs duty in effect on the day immediately preceding the date of entry into force of this Agreement with respect to Japan and the Party for which the forest good safeguard measure applies.

3. For the purposes of this Appendix, an originating forest good is from the Party if the originating forest good is wholly obtained in that Party or if the last change of tariff heading took place in that Party.

4. Any forest good safeguard measure applied under this Appendix may be maintained only until the end of the year in which it is applied.

5. For the purposes of this Appendix, year means, with respect to Year 1, the period from the date of entry into force of this Agreement for Japan through the following March 31, and with respect to Year 2 and each subsequent Year, the 12-month period from April 1 of the respective year until the following March 31.

6. With respect to the originating forest goods provided for in the tariff items indicated with "SG11" in Column "Remarks" in the Tariff Schedule of Japan, Japan may apply a forest good safeguard measure on the originating forest goods from Canada, only when the aggregate volume of imports of those originating forest goods from Canada in any year exceeds the trigger level set out as follows:

(a) 1,573,000 cubic metres for Year 1, except as provided in paragraph 16;

(b) 1,604,500 cubic metres for Year 2;

(c) 1,636,000 cubic metres for Year 3;

(d) 1,667,500 cubic metres for Year 4;

(e) 1,699,000 cubic metres for Year 5;

(f) 1,730,500 cubic metres for Year 6;

(g) 1,762,000 cubic metres for Year 7;

(h) 1,793,500 cubic metres for Year 8;

(i) 1,825,000 cubic metres for Year 9;

(j) 1,856,500 cubic metres for Year 10;

(k) 1,888,000 cubic metres for Year 11;

(l) 1,919,500 cubic metres for Year 12;

(m) 1,951,000 cubic metres for Year 13;

(n) 1,982,500 cubic metres for Year 14;

(o) 2,014,000 cubic metres for Year 15; and

(p) for each year beginning in Year 16 and continuing thereafter, the trigger level shall be 31,500 cubic metres greater than the trigger level in the previous year.

7. With respect to the originating forest goods provided for in the tariff items indicated with "SG12" in Column "Remarks" in the Tariff Schedule of Japan, Japan may apply a forest good safeguard measure on the originating forest goods from New Zealand, only when the aggregate volume of imports of those originating forest goods from New Zealand in any year exceeds the trigger level set out as follows:

(a) 65,000 cubic metres for Year 1, except as provided in paragraph 16;

(b) 66,100 cubic metres for Year 2;

(c) 67,200 cubic metres for Year 3;

(d) 68,300 cubic metres for Year 4;

(e) 69,400 cubic metres for Year 5;

(f) 70,500 cubic metres for Year 6;

(g) 71,600 cubic metres for Year 7;

(h) 72,700 cubic metres for Year 8;

(i) 73,800 cubic metres for Year 9; and

(j) 74,900 cubic metres for Year 10.

8. With respect to the originating forest goods provided for in the tariff items indicated with "SG13" in Column "Remarks" in the Tariff Schedule of Japan, Japan may apply a forest good safeguard measure on the originating forest goods from Canada, only when the aggregate volume of imports of those originating

forest goods from Canada in any year exceeds the trigger level set out as follows:

(a) 224,000 cubic metres for Year 1, except as provided in paragraph 16;

(b) 228,500 cubic metres for Year 2;

(c) 233,000 cubic metres for Year 3;

(d) 237,500 cubic metres for Year 4;

(e) 242,000 cubic metres for Year 5;

(f) 246,500 cubic metres for Year 6;

(g) 251,000 cubic metres for Year 7;

(h) 255,500 cubic metres for Year 8;

(i) 260,000 cubic metres for Year 9;

(j) 264,500 cubic metres for Year 10;

(k) 269,000 cubic metres for Year 11;

(l) 273,500 cubic metres for Year 12;

(m) 278,000 cubic metres for Year 13;

(n) 282,500 cubic metres for Year 14;

(o) 287,000 cubic metres for Year 15; and

(p) for each year beginning in Year 16 and continuing thereafter, the trigger level shall be 4,500 cubic metres greater than the trigger level in the previous year.

9. With respect to the originating forest goods provided for in the tariff items indicated with "SG14" in Column "Remarks" in the Tariff Schedule of Japan, Japan may apply a forest good safeguard measure on the originating forest goods from Malaysia, only when the aggregate volume of imports of those originating

forest goods from Malaysia in any year exceeds the trigger level set out as follows:

(a) 1,044,000 cubic metres for Year 1, except as provided in paragraph 16;

(b) 1,064,900 cubic metres for Year 2;

(c) 1,085,800 cubic metres for Year 3;

(d) 1,106,700 cubic metres for Year 4;

(e) 1,127,600 cubic metres for Year 5;

(f) 1,148,500 cubic metres for Year 6;

(g) 1,169,400 cubic metres for Year 7;

(h) 1,190,300 cubic metres for Year 8;

(i) 1,211,200 cubic metres for Year 9;

(j) 1,232,100 cubic metres for Year 10;

(k) 1,253,000 cubic metres for Year 11;

(l) 1,273,900 cubic metres for Year 12;

(m) 1,294,800 cubic metres for Year 13;

(n) 1,315,700 cubic metres for Year 14;

(o) 1,336,600 cubic metres for Year 15; and

(p) for each year beginning in Year 16 and continuing thereafter, the trigger level shall be 31,300 cubic metres greater than the trigger level in the previous year.

10. With respect to the originating forest goods provided for in the tariff items indicated with "SG15" in Column "Remarks" in the Tariff Schedule of Japan, Japan may apply a forest good safeguard measure on the originating forest goods from Malaysia, only when the aggregate volume of imports of those originating forest goods from Malaysia in any year exceeds the trigger level set out as follows:

(a) 616,000 cubic metres for Year 1, except as provided in paragraph 16;

(b) 628,300 cubic metres for Year 2;

(c) 640,600 cubic metres for Year 3;

(d) 652,900 cubic metres for Year 4;

(e) 665,200 cubic metres for Year 5;

(f) 677,500 cubic metres for Year 6;

(g) 689,800 cubic metres for Year 7;

(h) 702,100 cubic metres for Year 8;

(i) 714,400 cubic metres for Year 9;

(j) 726,700 cubic metres for Year 10;

(k) 739,000 cubic metres for Year 11;

(l) 751,300 cubic metres for Year 12;

(m) 763,600 cubic metres for Year 13;

(n) 775,900 cubic metres for Year 14;

(o) 788,200 cubic metres for Year 15; and

(p) for each year beginning in Year 16 and continuing thereafter, the trigger level shall be 18,500 cubic metres greater than the trigger level in the previous year.

11. With respect to the originating forest goods provided for in the tariff items indicated with "SG16" in Column "Remarks" in the Tariff Schedule of Japan, Japan may apply a forest good safeguard measure on the originating forest goods from Viet Nam, only when the aggregate volume of imports of those originating forest goods from Viet Nam in any year exceeds the trigger level set out as follows:

(a) 180,000 cubic metres for Year 1, except as provided in paragraph 16;

(b) 193,000 cubic metres for Year 2;

(c) 206,000 cubic metres for Year 3;

(d) 219,000 cubic metres for Year 4;

(e) 232,000 cubic metres for Year 5;

(f) 245,000 cubic metres for Year 6;

(g) 258,000 cubic metres for Year 7;

(h) 271,000 cubic metres for Year 8;

(i) 284,000 cubic metres for Year 9;

(j) 297,000 cubic metres for Year 10;

(k) 310,000 cubic metres for Year 11;

(l) 323,000 cubic metres for Year 12;

(m) 336,000 cubic metres for Year 13;

(n) 349,000 cubic metres for Year 14; and

(o) 362,000 cubic metres for Year 15.

12. With respect to the originating forest goods provided for in the tariff items indicated with "SG17" in Column "Remarks" in the Tariff Schedule of Japan, Japan may apply a forest good safeguard measure on the originating forest goods from Canada, New Zealand or Chile, only when the aggregate volume of imports of those originating forest goods from Canada, New Zealand or Chile respectively in any year exceeds the trigger level set out for each of those Parties as follows:

(a) For Canada:

(i) 7,000 cubic metres for Year 1, except as provided in paragraph 16;

(ii) 7,100 cubic metres for Year 2;

(iii) 7,200 cubic metres for Year 3;

(iv) 7,300 cubic metres for Year 4;

(v) 7,400 cubic metres for Year 5;

(vi) 7,500 cubic metres for Year 6;

(vii) 7,600 cubic metres for Year 7;

(viii) 7,700 cubic metres for Year 8;

(ix) 7,800 cubic metres for Year 9;

(x) 7,900 cubic metres for Year 10;

(xi) 8,000 cubic metres for Year 11;

(xii) 8,100 cubic metres for Year 12;

(xiii) 8,200 cubic metres for Year 13;

(xiv) 8,300 cubic metres for Year 14;

(xv) 8,400 cubic metres for Year 15; and

(xvi) for each year beginning in Year 16 and continuing thereafter, the trigger level shall be 100 cubic metres greater than the trigger level in the previous year.

(b) For New Zealand:

(i) 60,000 cubic metres for Year 1, except as provided in paragraph 16;

(ii) 61,200 cubic metres for Year 2;

(iii) 62,400 cubic metres for Year 3;

(iv) 63,600 cubic metres for Year 4;

(v) 64,800 cubic metres for Year 5;

(vi) 66,000 cubic metres for Year 6;

(vii) 67,200 cubic metres for Year 7;

(viii) 68,400 cubic metres for Year 8;

(ix) 69,600 cubic metres for Year 9;

(x) 70,800 cubic metres for Year 10;

(xi) 72,000 cubic metres for Year 11;

(xii) 73,200 cubic metres for Year 12;

(xiii) 74,400 cubic metres for Year 13;

(xiv) 75,600 cubic metres for Year 14; and

(xv) 76,800 cubic metres for Year 15.

(c) For Chile:

(i) 13,000 cubic metres for Year 1, except as provided in paragraph 16;

(ii) 14,000 cubic metres for Year 2;

(iii) 15,000 cubic metres for Year 3;

(iv) 16,000 cubic metres for Year 4;

(v) 17,000 cubic metres for Year 5;

(vi) 18,000 cubic metres for Year 6;

(vii) 19,000 cubic metres for Year 7;

(viii) 20,000 cubic metres for Year 8;

(ix) 21,000 cubic metres for Year 9;

(x) 22,000 cubic metres for Year 10;

(xi) 23,000 cubic metres for Year 11;

(xii) 24,000 cubic metres for Year 12;

(xiii) 25,000 cubic metres for Year 13;

(xiv) 26,000 cubic metres for Year 14; and

(xv) 27,000 cubic metres for Year 15.

13. Japan shall not apply or maintain any forest good safeguard measure set out in paragraphs 7 and 11 after the elimination of the customs duties on the corresponding originating forest goods provided for in the tariff items indicated with "SG12" and "SG16" in Column "Remarks" in the Tariff Schedule of Japan.

14. Japan shall not apply or maintain any forest good safeguard measure on the originating forest goods from New Zealand and Chile set out in paragraph 12 after the elimination of the customs duties on the corresponding originating forest goods provided for in the tariff items indicated with "SG17" in Column "Remarks" in the Tariff Schedule of Japan.

15. Japan and Malaysia shall examine the necessity of the forest good safeguard measures set out in paragraphs 9 and 10 in a committee established by those two Parties two years before the elimination of the customs duties on the originating forest goods provided for in the tariff items indicated with "SG14" and "SG15" in Column "Remarks" in the Tariff Schedule of Japan.

16. If Year 1 is less than 12 months, the applicable trigger level for Year 1 for the purposes of paragraphs 6 through 12 shall be determined by multiplying the whole volume for Year 1 set out in paragraphs 6 through 12 respectively by a fraction the numerator of which shall be the number of months between the date of entry into force of this Agreement for Japan and the following March 31 and the denominator of which shall be 12. For the purpose of determining the numerator specified in the previous sentence and for the purpose of determining the applicable trigger level in accordance with the previous sentence, any fraction of less than 1.0 shall be rounded to the nearest whole number (in the case of 0.5, the fraction shall be rounded to 1.0).


APPENDIX C

TARIFF DIFFERENTIALS

For an originating good identified below in Table C-1, during the period specified in the Table for each good, in accordance with the origin criterion applied in a claim for preferential tariff treatment of the importer:

(a) Japan shall apply either:

(i) the rate of customs duty applicable to the originating good from the Party where the good acquired the originating status in accordance with the process or change in tariff classification requirement set out in Annex 3-D (Product Specific Rules of Origin); or

(ii) the rate of customs duty applicable to the originating good from the Party where the largest value was added among claimed production process, or the highest rate among the rates applicable to the originating good from those Parties involved in claimed production process, when the good acquired the originating status through a production process in accordance with the requirement set out in Article 3.2 (a) or (b) (Originating Goods), or the regional value content requirement set out in Annex 3-D (Product-Specific Rules of Origin).

(b) Notwithstanding subparagraph (a)(i), for an originating good, other than a good classified in Chapters 84 through 91 that is assembled with parts, when the good acquired the originating status in accordance with the change in tariff classification requirement set out in Annex 3-D (Product-Specific Rules of Origin) and the material used in the production of the originating good is classified in, as the case may be:

(i) the same chapter as the complete or finished good if the applicable requirement is based on a change in chapter;

(ii) the same heading as the complete or finished good if the applicable requirement is based on a change in heading; or

(iii) the same subheading as the complete or finished good if the applicable requirement is based on a change in subheading, Japan shall apply the rate of customs duty applicable to the originating good from the Party where such material used in the production of the originating good, referred to in (i), (ii) or (iii) respectively, is produced.

(c) If the rate of customs duty is not determined by application of subparagraph (a) or (b), Japan shall apply the rate of customs duty applicable to the originating good from the Party where the largest value was added among claimed production process.

(d) If the product-specific rule of origin requires to satisfy the regional value content requirement in combination with the process requirement or the change in tariff classification requirement, the applicable rate of customs duty is determined by application of subparagraph (a) (ii).

Note: For greater certainty, this table includes only:

(1) those tariff items with a tariff differential of more than 3 percentage points; and

(2) those tariff items with a tariff differential for which the rate of customs duty is non-ad valorem.


APPENDIX D-1

BETWEEN JAPAN AND THE UNITED STATES ON MOTOR VEHICLE TRADE

Article 1

1. For the purposes of this Appendix:

Appendix Party means either Japan or the United States, as the case may be; motor vehicle means any good classified under heading 87.03 or 87.04;

originating motor vehicle means any motor vehicle qualifying as originating under Chapter 3 (Rules of Origin and Origin Procedures); and

TBT Agreement means the WTO Agreement on Technical Barriers to Trade, as may be amended.

The definitions of the terms used in this Appendix contained in Annex 1 of the TBT Agreement, including the chapeau and explanatory notes of Annex 1, are incorporated into this Appendix and shall form part of this Appendix mutatis mutandis.

2. Article 2, Article 3 and Article 4 shall apply to the preparation, adoption and application of all technical regulations, standards and conformity assessment procedures of central government bodies that may affect trade in motor vehicles between the Appendix Parties, except as provided in paragraphs 4 and 5.

3. All references in this Appendix to technical regulations, standards and conformity assessment procedures shall be construed to include any amendments to them and any addition to the rules or the product coverage of those technical regulations, standards and procedures, except amendments and additions of an insignificant nature.

4. This Appendix shall not apply to technical specifications prepared by a governmental entity for its production or consumption requirements. These specifications are covered by Chapter 15 (Government Procurement).

5. This Appendix shall not apply to sanitary and phytosanitary measures. These are covered by Chapter 7 (Sanitary and Phytosanitary Measures).

6. No Party other than an Appendix Party shall have recourse to dispute settlement under Chapter 28 (Dispute Settlement) for any matter arising under this Appendix or to dispute settlement under Article 7 for any matter arising under this Agreement. No Appendix Party shall have recourse to dispute settlement under Chapter 28 (Dispute Settlement) for nullification or impairment within the meaning of Article 28.3.1(c) (Scope) for any matter arising under Article 6, Article 7 or Article 8 of this Appendix.

Article 2

1. Except in those urgent circumstances referred to in Article 2.10 and Article 5.7 of the TBT Agreement, for any technical regulation or conformity assessment procedure that would require a substantial change in motor vehicle design or technology, each Appendix Party shall provide an interval between the date of publication of the technical regulation or conformity assessment procedure and the date on which compliance with the measure becomes mandatory that is usually not less than 12 months.

2. Each Appendix Party shall ensure that its advisory committees and similar groups established by, or operated under the direction of, an agency of the central level of government to provide to it advice or recommendations by consensus that could result in regulations or other measures that would materially affect the certification, importation, sale, distribution or functioning of motor vehicles, are established and operated in a transparent manner. To that end, each Appendix Party shall ensure that, in accordance with its laws and regulations:

(a) timely notice of the formation of such advisory committees and similar groups is published;

(b) timely notice of meetings of such advisory committees and similar groups is published;

(c) meetings of such advisory committees and similar groups are open to the public;

(d) interested persons have opportunities to appear before or file statements with such advisory committees and similar groups; and

(e) detailed meeting minutes and other documents made available to or prepared by such advisory committees and similar groups are made available to the public.

3.

(a) Each Appendix Party shall, no later than the date on which it first supplies information in writing to a non-governmental expert4or interested person for comment,5regarding a technical regulation, standard or conformity assessment procedure affecting motor vehicles that it is developing, make the same information publicly available, such as by publishing the information on an official website.

(b) Following the provision of information under subparagraph (a), the Appendix Party providing such information shall, on request of the other Appendix Party, provide additional available information with respect to the technical regulation, standard or conformity assessment procedure concerned, such as information regarding other regulatory approaches under consideration and analysis of the impact of that regulatory measure and those approaches.

4.

(a) Each Appendix Party shall endeavour to periodically conduct post-implementation reviews of its significant regulations setting out technical regulations, standards or conformity assessment procedures that affect motor vehicles.

(b) For the purposes of this paragraph:

post-implementation review means an examination of the effectiveness of a technical regulation, standard or conformity assessment procedure after it has been implemented, including, as appropriate, an assessment of whether it achieves its stated objectives, the burden it imposes and its compatibility with other technical regulations, standards or conformity assessment procedures the Appendix Party has adopted.

Article 3

1. The Appendix Parties shall cooperate bilaterally, including in their activities under the Agreement concerning the Establishing of Global Technical Regulations for Wheeled Vehicles, Equipment and Parts which can be fitted and/or be used on Wheeled Vehicles (1998 Agreement), to harmonise standards for motor vehicle environmental performance and safety.

2. Each Appendix Party shall ensure that technical regulations related to motor vehicles are not prepared, adopted or applied with a view to or with the effect of creating unnecessary obstacles to international trade, to the extent provided for in Article 2.2 of the TBT Agreement. For this purpose, technical regulations related to motor vehicles shall not be more trade-restrictive than necessary to fulfil a legitimate objective, taking account of the risks non fulfilment would create. Such legitimate objectives are, inter alia: national security requirements; the prevention of deceptive practices; and protection of human health or safety, animal or plant life or health, or the environment. In assessing such risks, relevant elements of consideration are, inter alia: available scientific and technical information, related processing technology or intended end-uses of products.

3. Neither Appendix Party shall prevent or unduly delay the placing on its market of a motor vehicle product on the ground that the product incorporates a new technology or a new feature which has not yet been regulated, unless the Appendix Party finds, based on scientific or technical information, that this new technology or new feature poses a risk for human health or safety, or the environment.

4. When an Appendix Party decides to refuse the placing on its market or require the withdrawal from its market of a motor vehicle product on the ground that the product incorporates a new technology or a new feature posing a risk for human health or safety, or the environment, the Appendix Party shall immediately notify the importer of the product of its decision. The notification shall include all relevant scientific or technical information.

5. Each Appendix Party shall adopt or maintain efficient procedures for the temporary importation of motor vehicles incorporating new technologies or new features for the purposes of demonstration, display or road testing within its territory. Each Appendix Party shall facilitate the entry of such vehicles into its territory in accordance with these procedures regardless of whether they comply with otherwise applicable standards or technical regulations.

6.

(a) With respect to requirements of a safety regulation under the Road Vehicle Law (Law No. 185 of 1951) of Japan (Road Vehicle Law) that the competent authority of Japan identified as of April 1, 2015, if the competent authority of Japan finds that a requirement of the U.S. FMVSS is no less stringent than the requirement under the Road Vehicle Law to which it corresponds, originating motor vehicles from the United States classified under heading 87.03 that comply with such a requirement of the U.S. FMVSS shall be deemed to comply with that requirement under the Road Vehicle Law. Such treatment shall apply unless that requirement under the Road Vehicle Law is modified and, as modified, is substantially more stringent than previously. In that event, Japan shall continue to provide such treatment for a period that is usually not less than 12 months after the date on which the requirement under the Road Vehicle Law is modified.

(b) Japan shall permit the importation and use of any motor vehicle part necessary to repair or service an originating motor vehicle from the United States classified under heading 87.03 that, at the time of the motor vehicle's initial inspection in Japan, was deemed, pursuant to subparagraph (a), to comply with a requirement under the Road Vehicle Law, provided that the part meets the same specifications of the part originally installed in the motor vehicle at the time of its initial inspection.

(c) For the purposes of this paragraph:

U.S. FMVSS means Federal Motor Vehicle Safety Standard of the United States; and

initial inspection means the inspection that motor vehicles must undergo in order to be used for transport in Japan in accordance with the Road Vehicle Law.

Article 4

1. Japan shall not adopt any requirement under the Preferential Handling Procedure that is not applied on the date of entry into force of this Agreement with respect to Japan and the United States and that increases the burden, including the complexity and cost, for importers under the Preferential Handling Procedure, except for requirements related to new technical regulations or amendments to existing technical regulations that are prepared, adopted and applied in a manner consistent with Article 3.2 after that date, or for an increase of fees and charges commensurate with the cost of services rendered under the Preferential Handling Procedure.

2. Japan shall ensure that the Preferential Handling Procedure and its relevant regulations are adopted and applied in a manner that does not preclude the eligibility of motor vehicles imported under the Preferential Handling Procedure for any financial incentive measures of central government bodies14 with respect to motor vehicles.

3. For the purposes of this Article:

Preferential Handling Procedure means a simplified conformity assessment procedure conducted exclusively for imported motor vehicles up to a designated number for each type, in accordance with the notification of the Minister of Land, Infrastructure, Transport and Tourism of Japan.

Article 5

To the extent that an Appendix Party maintains and applies any laws or regulations at the central level of government with respect to zoning applicable to the establishment of distribution or repair facilities for motor vehicles, it shall ensure such laws or regulations are applied in a transparent and non discriminatory manner.

Article 6

An Appendix Party may apply a transitional safeguard measure on originating motor vehicles from the other Appendix Party classified under heading 87.03 or 87.04, during the transition period only, in accordance with the provisions set out in Chapter 6 (Trade Remedies), with the following procedural modifications:

(a) In lieu of the definition of transition period provided for in Article 6.1 (Definitions), the following definition shall apply:

transition period means the period beginning on the date of entry into force of this Agreement with respect to Japan and the United States and ending on the date that is 10 years after the end of the period of the staged tariff elimination for a particular good.

(b) In lieu of Article 6.4.2 (Standards for a Transitional Safeguard Measure), the following shall apply:

Neither Appendix Party shall apply a transitional safeguard measure for a period exceeding two years, except that the period may be extended by up to two years if the competent authority of the Appendix Party that applies the measure determines, in conformity with the procedures set out in Article 6.5 (Investigation Procedures and Transparency Requirements), that the transitional safeguard measure continues to be necessary to prevent or remedy serious injury and to facilitate adjustment.

(c) Paragraphs 4 and 6 of Article 6.4 (Standards for a Transitional Safeguard Measure) shall not apply.

(d) In lieu of paragraphs 1 and 2 of Article 6.7 (Compensation), the following shall apply:

(i) an Appendix Party applying a transitional safeguard measure shall consult with the other Appendix Party in order to mutually agree on appropriate trade liberalising compensation in the form of concessions that have substantially equivalent trade effects or equivalent to the value of the additional duties expected to result from the transitional safeguard measure. The Appendix Party shall provide an opportunity for those consultations no later than 30 days after the application of the transitional safeguard measure;

(ii) if the consultations under subparagraph (d)(i) do not result in an agreement on trade liberalising compensation within 30 days after the consultations begin, the Appendix Party against whose good the transitional safeguard measure is applied may suspend the application of substantially equivalent concessions to the trade of the Appendix Party applying the transitional safeguard measure; and

(iii) the right of suspension referred to in subparagraph (d)(ii) shall not be exercised for the first 24 months during which a transitional safeguard measure is in effect, provided that the transitional safeguard measure conforms to the provisions of this Agreement.

Article 7

1. For the purposes of this Article, the definitions set out in Article 28.1 (Definitions) shall apply, mutatis mutandis.

2. With respect to any matter described in Article 28.3 (Scope) that relates to motor vehicles, an Appendix Party may initiate the dispute settlement procedures set out in this Article in lieu of the procedures provided for in Article 28.4 (Choice of Forum), Article 28.5 (Consultations), Article 28.6 (Good Offices, Conciliation and Mediation), Article 28.7 (Establishment of a Panel), Article 28.8 (Terms of Reference), Article 28.9 (Composition of Panels), Article 28.10 (Qualifications of Panellists), Article 28.11 (Roster of Panel Chairs and Party Specific Lists), Article 28.12 (Function of Panels), Article 28.13 (Rules of Procedure for Panels), Article 28.14 (Third Party Participation), Article 28.15 (Role of Experts), Article 28.16 (Suspension or Termination of Proceedings), Article 28.17 (Initial Report), Article 28.18 (Final Report), Article 28.19 (Implementation of Final Report), Article 28.20 (Non-Implementation – Compensation and Suspension of Benefits) and Article 28.21 (Compliance Review).

3.

(a) An Appendix Party may request consultations with the other Appendix Party with respect to any matter described in paragraph 2. The Appendix Party making the request for consultations shall do so in writing, and shall set out the reasons for the request, including identification of the actual or proposed measure or other matter at issue and an indication of the legal basis for the complaint. The requesting Appendix Party shall circulate the request concurrently to the other Parties through the overall contact points designated under Article 27.5.1 (Contact Points).

(b) The Appendix Party to which a request for consultations is made shall, unless the Appendix Parties agree otherwise, reply in writing to the request no later than seven days after the date of its receipt of the request. That Appendix Party shall circulate its reply concurrently to the other Parties through the overall contact points and enter into consultations in good faith.

(c) Unless the Appendix Parties agree otherwise, they shall enter into consultations no later than 15 days after the date of receipt of the request.

(d) Unless the Appendix Parties agree otherwise, paragraphs 5 through 8 of Article 28.5 (Consultations) shall apply, mutatis mutandis, to the consultations under this paragraph.

4.

(a) An Appendix Party that requested consultations under paragraph 3(a) may request, by means of a written notice addressed to the other Appendix Party, the establishment of a panel if the Appendix Parties fail to resolve the matter within a period of 30 days after the date of receipt of the request for consultations under paragraph 3(a).

(b) The complaining Appendix Party shall circulate the request concurrently to the other Parties through the overall contact points designated under Article 27.5.1 (Contact Points).

(c) Paragraphs 3, 4 and 7 of Article 28.7 (Establishment of a Panel) shall apply, mutatis mutandis, to the establishment of a panel. Unless the Appendix Parties agree otherwise, the panel shall be composed in a manner consistent with this Article and, subject to the time frames set out in paragraph 6, the Rules of Procedure.

5.

(a) Unless the Appendix Parties agree otherwise no later than 15 days after the date of delivery of the request for the establishment of a panel, the terms of reference shall be to:

(i) examine, in the light of the relevant provisions of this Agreement, the matter referred to in the request for the establishment of a panel under paragraph 4(a); and

(ii) make findings and determinations, and any jointly requested recommendations, together with its reasons therefor, as provided for in Article 28.17.4 (Initial Report) as applied pursuant to paragraph 8.

(b) If, in its request for the establishment of a panel, the complaining Appendix Party claims that a measure nullifies or impairs benefits within the meaning of Article 28.3.1(c) (Scope), the terms of reference shall so indicate.

6.

(a) A panel shall be composed of three members.

(b) Unless the Appendix Parties agree otherwise, they shall apply the following procedures to compose a panel:

(i) Within a period of 15 days after the date of delivery of the request for the establishment of a panel under paragraph 4(a), the complaining Appendix Party, on the one hand, and the responding Appendix Party, on the other, shall each appoint a panellist and notify each other of those appointments.

(ii) If the complaining Appendix Party fails to appoint a panellist within the period specified in subparagraph (b)(i), the dispute settlement proceedings shall lapse at the end of that period.

(iii) If the responding Appendix Party fails to appoint a panellist within the period specified in subparagraph (b)(i), the complaining Appendix Party shall select the panellist not yet appointed:

(A) from the responding Appendix Party's list established under Article 28.11.9 (Roster of Panel Chairs and Party Specific Lists);

(B) if the responding Appendix Party has not established a list under Article 28.11.9 (Roster of Panel Chairs and Party Specific Lists), from the roster of panel chairs established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists); or

(C) if the responding Appendix Party has not established a list under Article 28.11.9 (Roster of Panel Chairs and Party Specific Lists) and no roster of panel chairs has been established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists), by random selection from a list of three candidates, who are not nationals of the complaining Appendix Party, nominated by the complaining Appendix Party,

no later than 20 days after the date of delivery of the request for the establishment of a panel under paragraph 4(a).

(iv) For appointment of the third panellist, who shall serve as chair:

(A) the Appendix Parties shall endeavour to agree on the appointment of a chair;

(B) if the Appendix Parties fail to appoint a chair under subparagraph (b)(iv)(A) within a period of 15 days after the date of delivery of the request for the establishment of the panel under paragraph 4(a), the Appendix Parties shall select the chair by random selection from the roster established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists) within a period of 20 days after the date of delivery of the request for the establishment of the panel; or

(C) if a roster has not been established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists), and subparagraphs (b)(iv)(A) and (B) cannot apply, each Appendix Party may nominate up to three candidates. The chair shall be randomly selected from those candidates that are nominated within a period of 20 days after the date of delivery of the request for the establishment of a panel under paragraph 4(a).

(D) The chair shall not be a national of either Appendix Party and any nationals of the Appendix Parties appointed to the roster established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists) shall be excluded from a selection process under subparagraph (b)(iv).

(v) If a panellist selected under subparagraph (b)(iii) or (iv)(B) is unable to serve on the panel, the Appendix Parties shall meet no later than five days after the date of learning that the panellist is unavailable to select another panellist from among the remaining members of the list (in the case of subparagraph (b)(iii)), or the roster (in the case of subparagraph (b)(iv)(B)).

(vi) If a panellist appointed under this paragraph resigns or becomes unable to serve on the panel, either during the course of proceeding or when the panel is reconvened under paragraph 10(b), 13 or 17, a replacement panellist shall be appointed within 12 days in accordance with the selection procedures prescribed in this subparagraph for the appointment of the original panellist. The replacement shall have all the powers and duties of the original panellist. The work of the panel shall be suspended pending the appointment of the replacement panellist, and all time frames set out in this Article and in the Rules of Procedure shall be extended by the amount of time that the work was suspended.

(vii) Paragraphs 4, 5 and 10 of Article 28.9 (Composition of Panels) shall apply, mutatis mutandis, to the selection procedures.

7. All panellists shall meet the requirements set out in Article 28.10.1 (Qualifications of Panellists). An individual shall not serve as a panellist for a dispute in which that person has participated under Article 28.6 (Good Offices, Conciliation, and Mediation) as applied pursuant to paragraph 8.

8. Unless the Appendix Parties agree otherwise, Article 28.4 (Choice of Forum), Article 28.6 (Good Offices, Conciliation and Mediation), Article 28.12 (Function of Panels), Article 28.15 (Role of Experts), Article 28.16 (Suspension or Termination of Proceedings), Article 28.17 (Initial Report) and Article 28.18 (Final Report) shall apply, mutatis mutandis,22 to panel proceedings under this Article, except that:

(a) with respect to Article 28.17.3 (Initial Report), the panel shall present an initial report to the Appendix Parties no later than 120 days after the date of the appointment of the last panellist;

(b) with respect to Article 28.17.4 (Initial Report), the panel shall also make a determination as to whether the non-conformity or the nullification or impairment, if any, has materially affected the sale, offering for sale, purchase, transportation, distribution or use of originating motor vehicles from the complaining Appendix Party;

(c) with respect to Article 28.17.7 (Initial Report), an Appendix Party may submit written comments to the panel on its initial report no later than 10 days after the presentation of the initial report or within another period as the Appendix Parties may agree; and

(d) with respect to Article 28.18.1 (Final Report), the panel shall present a final report to the Appendix Parties, including any separate opinions on matters not unanimously agreed, no later than 20 days after presentation of the initial report. After taking any steps to protect confidential information, and no later than seven days after the presentation of the final report, the Appendix Parties shall release the final report to the public.

9. Unless the Appendix Parties agree otherwise, paragraphs 1 and 2 of Article 28.19 (Implementation of Final Report) shall apply, mutatis mutandis, to the implementation of the final report.

10.

(a) Unless the Appendix Parties agree otherwise, if in its final report the panel determines that:

(i) (A) the measure at issue is inconsistent with an Appendix Party's obligations in this Agreement;

(B) an Appendix Party has otherwise failed to carry out its obligations in this Agreement; or

(C) the measure at issue is causing nullification or impairment within the meaning of Article 28.3.1(c) (Scope); and

(ii) the non-conformity or the nullification or impairment that the panel has determined to exist has materially affected the sale, offering for sale, purchase, transportation, distribution or use of originating motor vehicles from the complaining Appendix Party, the complaining Appendix Party may suspend the application to the responding Appendix Party of benefits or take action in accordance with paragraphs 11 through 17.

(b) Unless the Appendix Parties agree otherwise, if in its final report the panel determines that the non-conformity or the nullification or impairment that the panel has determined to exist under subparagraph (a)(i) has not materially affected the sale, offering for sale, purchase, transportation, distribution or use of originating motor vehicles from the complaining Appendix Party, the procedures provided for in paragraphs 3 through 7 of Article 28.19 (Implementation of Final Report), Article 28.20 (Non Implementation – Compensation and Suspension of Benefits) and Article 28.21 (Compliance Review) shall apply, mutatis mutandis.

11. If a final report that contains a determination described in paragraph 10(a) is presented to the Appendix Parties under paragraph 8(d) on or after the date on which customs duties imposed by the complaining Appendix Party on originating motor vehicles from the responding Appendix Party classified under heading 87.03, Harmonized Tariff Schedule of the United States (HTSUS) 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 or HTSUS 8704.90.00 have begun to be reduced in accordance with the complaining Appendix Party's Schedule to Annex 2-D (Tariff Commitments), taking into account any delay of implementation of the period of the staged tariff elimination as a result of previous action taken pursuant to paragraph 14(a)(i), the complaining Appendix Party may increase the rate of customs duty on those originating motor vehicles:

(a) to a level not to exceed the prevailing most-favoured-nation applied rate of customs duty on those motor vehicles, for a period of up to 90 days after the release of the final report under paragraph 8(d); and

(b) thereafter, to a level not to exceed the prevailing most-favoured nation applied rate of customs duty on those motor vehicles, less 50 per cent of the difference between that rate and the rate of customs duty on those originating motor vehicles set out in the complaining Appendix Party's Schedule to Annex 2-D (Tariff Commitments), as adjusted to take into account any delay of implementation of the period of the staged tariff elimination as a result of previous action taken pursuant to paragraph 14(a)(i), provided that the complaining Appendix Party shall not suspend the application to the responding Appendix Party of benefits under this paragraph following a determination by the panel under paragraph 13.

12.

(a) At any time after release of a final report that contains a determination described in paragraph 10(a), the complaining Appendix Party may provide a written notice to the responding Appendix Party that it intends to suspend benefits under paragraph 14(a)(ii) or (b), or to take action under paragraph 14(a)(i). The notice shall specify the level of benefits that the complaining Appendix Party proposes to suspend under paragraph 14(a)(ii) or (b), or the level of benefits for the purposes of taking action under paragraph 14(a)(i). The complaining Appendix Party may request that the panel be reconvened to determine the level of benefits up to which it may suspend under paragraph 14(a)(ii) or (b), or the level of benefits for the purposes of taking action under paragraph 14(a)(i), at any time after it provides a notice under this subparagraph.

(b) If the responding Appendix Party considers that the level of benefits proposed to be suspended or that has been suspended under paragraph 14(a)(ii) or (b), or the level of benefits for the purposes of taking action under paragraph 14(a)(i), is manifestly excessive, or that it has eliminated the non-conformity or the nullification or impairment that the panel has determined to exist, it may request that the panel be reconvened to consider the matter.

(c) Regardless of whether the complaining Appendix Party has provided a notice under subparagraph (a), the responding Appendix Party may request that the panel be reconvened to determine the level of benefits under paragraph 13:

(i) if the complaining Appendix Party has increased the rate of customs duty under paragraph 11; or

(ii) for the purposes of the determination of the length of time by which the complaining Appendix Party may delay implementation of the period of the staged tariff elimination under paragraph 14(a)(i).

(d) An Appendix Party shall deliver any request to reconvene the panel in writing to the other Appendix Party.

13. Unless the Appendix Parties agree otherwise, the panel shall reconvene as soon as possible after the date of delivery of the request under paragraph 12 and shall present to the Appendix Parties its determination of the level of benefits that the complaining Appendix Party may suspend no later than 90 days after it reconvenes. The panel shall determine the level of benefits that the complaining Appendix Party may suspend under paragraph 14(a)(ii) or (b), or the level of benefits for the purposes of taking action under paragraph 14(a)(i), as the sum of:

(a) the level of benefits of equivalent effect, as set out in Article 28.20.5 (Non-Implementation – Compensation and Suspension of Benefits); and

(b) the level of benefits referred to in subparagraph (a) multiplied by the ratio of the average of the total value of annual imports of originating motor vehicles from the responding Appendix Party classified under heading 87.03 into the complaining Appendix Party in the most recent four years to the average of the total value of annual imports of originating motor vehicles from the complaining Appendix Party classified under heading 87.03 into the responding Appendix Party in the most recent four years, to the extent that the sum of this amount and the level of benefits referred to in subparagraph (a) does not exceed the amount that is the sum of 3.75 per cent of the average of the total value of annual imports of originating motor vehicles from Japan classified under heading 87.03 into the United States in the most recent four years and 37.5 per cent of the average of the total value of annual imports of originating motor vehicles from Japan classified under HTSUS 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 and HTSUS 8704.90.00 into the United States in the most recent four years.

14. Following a determination by the panel under paragraph 13, the complaining Appendix Party may:

(a) (i) if a final report that contains a determination described in paragraph 10(a) is presented to the Appendix Parties under paragraph 8(d) prior to the date on which customs duties imposed by the complaining Appendix Party on originating motor vehicles from the responding Appendix Party classified under heading 87.03, HTSUS 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 or HTSUS 8704.90.00 will begin to be reduced in accordance with the complaining Appendix Party's Schedule to Annex 2-D (Tariff Commitments), taking into account any delay of implementation of the period of the staged tariff elimination as a result of previous action taken pursuant to paragraph 14(a)(i), delay implementation of the period of the staged tariff elimination of originating motor vehicles from the responding Appendix Party classified under heading 87.03, HTSUS 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 or HTSUS 8704.90.00, in accordance with the following:

(A) the length of time by which the complaining Appendix Party may delay implementation of the period of the staged tariff elimination shall be the product of the period of non-conformity or nullification or impairment and the level of benefits determined by the panel under paragraph 13, divided by the amount that is the sum of 3.75 per cent of the average of the total value of annual imports of originating motor vehicles from Japan classified under heading 87.03 into the United States in the most recent four years and 37.5 per cent of the average of the total value of annual imports of originating motor vehicles from Japan classified under HTSUS 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 and HTSUS 8704.90.00 into the United States in the most recent four years; and

(B) for the purposes of paragraph 14(a)(i), the period of non-conformity or nullification or impairment shall be the period beginning on the date on which the final report that contains a determination described in paragraph 10(a) is presented to the Appendix Parties under paragraph 8(d), and ending on the date on which the panel determines that the responding Appendix Party has eliminated the non-conformity or the nullification or impairment or a mutually satisfactory solution is reached, provided that, if the date on which the panel issues its determination under paragraph 13 is more than 90 days after the date on which the panel reconvenes, the number of days by which the issuance of that determination exceeded 90 days shall not be included in the period of non-conformity or nullification or impairment; or

(ii) if a final report that contains a determination described in paragraph 10(a) is presented to the Appendix Parties under paragraph 8(d) on or after the date on which customs duties imposed by the complaining Appendix Party on originating motor vehicles from the responding Appendix Party classified under heading 87.03, HTSUS 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 or HTSUS 8704.90.00 have begun to be reduced in accordance with the complaining Appendix Party's Schedule to Annex 2-D (Tariff Commitments), taking into account any delay of implementation of the period of the staged tariff elimination as a result of previous action taken pursuant to subparagraph (a)(i), unless the panel has determined that the responding Appendix Party has eliminated the non conformity or the nullification or impairment, suspend the application of benefits to the responding Appendix Party with respect to those originating motor vehicles up to the level determined by the panel under paragraph 13, provided that, to the extent that the level of benefits determined by the panel under paragraph 13(a) exceeds the level of benefits that may be suspended with respect to those originating motor vehicles, the complaining Appendix Party may increase the rate of customs duty on originating goods from the responding Appendix Party other than those originating motor vehicles to a level not exceeding the prevailing most-favoured-nation applied rate of customs duty on such goods; or

(b) if the prevailing most-favoured-nation applied rate of customs duty imposed by the complaining Appendix Party on motor vehicles classified under headings 87.03 and 87.04 is zero per cent, unless the panel has determined that the responding Appendix Party has eliminated the non-conformity or the nullification or impairment, suspend the application to the responding Appendix Party of benefits with respect to originating goods from the responding Appendix Party up to the level determined by the panel under paragraph 13; and

(i) if a final report that contains a determination described in paragraph 10(a) is presented to the Appendix Parties under paragraph 8(d) prior to the date on which customs duties imposed by the responding Appendix Party on originating motor vehicles from the complaining Appendix Party classified under heading 87.03, HTSUS 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 or HTSUS 8704.90.00 will begin to be reduced in accordance with the responding Appendix Party's Schedule to Annex 2-D (Tariff Commitments), taking into account any delay of implementation of the period of the staged tariff elimination as a result of previous action taken pursuant to subparagraph (a)(i), for a period of up to 90 days after the date on which the panel issues its determination under paragraph 13, suspend the application to the responding Appendix Party of benefits with respect to originating goods from the responding Appendix Party up to the level that is one-fourth of the annual level of benefits determined by the panel under paragraph 13; or

(ii) if a final report that contains a determination described in paragraph 10(a) is presented to the Appendix Parties under paragraph 8(d) on or after the date on which customs duties imposed by the responding Appendix Party on originating motor vehicles from the complaining Appendix Party referred to in subparagraph (b)(i) have begun to be reduced in accordance with the responding Appendix Party's Schedule to Annex 2-D (Tariff Commitments), taking into account any delay of implementation of the period of the staged tariff elimination as a result of previous action taken pursuant to subparagraph (a)(i):

(A) for a period of up to 90 days after the date on which the panel issues its determination under paragraph 13, suspend the application to the responding Appendix Party of benefits with respect to originating goods from the responding Appendix Party up to one-fourth of the amount that is the sum of 3.75 per cent of the average of the total value of annual imports of originating motor vehicles from Japan classified under heading 87.03 into the United States in the most recent four years and 37.5 per cent of the average of the total value of annual imports of originating motor vehicles from Japan classified under HTSUS 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 and HTSUS 8704.90.00 into the United States in the most recent four years; and

(B) if the date on which the panel issues its determination under paragraph 13 is more than 90 days after the date on which the panel reconvenes, beginning on the date that is 90 days after the panel issues its determination, for the number of days by which the issuance of that determination exceeded 90 days, suspend the application to the responding Appendix Party of benefits with respect to originating goods from the responding Appendix Party up to an amount that shall not exceed one-half of the amount described under subparagraph (b)(ii)(A), provided that the increased rate of customs duty applied to any good shall not exceed the prevailing most-favoured-nation applied rate of customs duty on that good.

15. Suspension of benefits under paragraph 11 or paragraph 14(a)(ii) or (b) shall be a temporary measure and only be applied until the responding Appendix Party has eliminated the non-conformity or the nullification or impairment, or until a mutually satisfactory solution is reached.

16.

(a) The complaining Appendix Party shall provide a written notice to the responding Appendix Party of any increase in the rate of customs duty pursuant to paragraph 11 or paragraph 14(a)(ii) or (b) no later than the date on which the increase in the rate of customs duty takes effect.

(b) The complaining Appendix Party shall provide a written notice to the responding Appendix Party of the length of any delay of implementation of the period of the staged tariff elimination pursuant to paragraph 14(a)(i) no later than the day immediately preceding the date on which the first reduction in the rate of customs duty on originating motor vehicles referred to in that paragraph would have otherwise occurred.

17.

(a) Without prejudice to the procedures in paragraphs 11 through 14, if the responding Appendix Party considers that it has eliminated the non-conformity or the nullification or impairment found by the panel, it may refer the matter to the panel by providing a written notice to the complaining Appendix Party. The panel shall issue its report on the matter no later than 90 days after the responding Appendix Party provides the written notice.

(b) If the panel determines that the responding Appendix Party has eliminated the non-conformity or the nullification or impairment, the complaining Appendix Party shall promptly reinstate any benefits suspended under paragraph 11 or paragraph 14(a)(ii) or (b).

18. The procedures set out in this Article shall apply beginning on January 1 of the second year after the date of entry into force of this Agreement with respect to Japan and the United States and ending on the date that is five years after the date on which customs duties imposed by the United States on originating motor vehicles from Japan classified under heading 87.03, HTSUS 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 and HTSUS 8704.90.00 have been eliminated in accordance with the United States Schedule to Annex 2-D (Tariff Commitments), taking into account any delay of implementation of the period of the staged tariff elimination as a result of previous action taken pursuant to paragraph 14(a)(i), provided that the procedures shall apply to any dispute for which the final report of the panel under paragraph 8(d) was presented prior to that date.

19. The Appendix Parties shall review, on request of either Appendix Party, the operation and effectiveness of this Article five years after the date of entry into force of this Agreement with respect to Japan and the United States, and at such interval as the Appendix Parties decide thereafter.

Article 8

1. An Appendix Party may request in writing to initiate a process for consultations with the other Appendix Party with respect to any non-tariff measure that relates to motor vehicles that the other Appendix Party is considering proposing or has proposed, regardless of whether the other Appendix Party has published the non-tariff measure for comment.

2. The process for consultations shall take place no later than 10 days after the date of receipt of a request under paragraph 1, unless the Appendix Parties agree otherwise. The Appendix Party to which such a request is made shall afford the requesting Appendix Party an opportunity to raise issues and to make inquiries, provide the requesting Appendix Party with information to the extent possible, and hear the views of the requesting Appendix Party on the non-tariff measure referred to in paragraph 1.

3. If a request under paragraph 1 concerns a proposed non-tariff measure that is open for comment, the Appendix Party to which the request is made shall refrain from implementing the proposed non-tariff measure during the comment period, except where urgent problems of safety, health, environmental protection or national security arise.

4. If a non-tariff measure as to which a request has been made under paragraph 1 is adopted, and the requesting Appendix Party considers that, as described in Article 28.3.1(b) (Scope), the measure is inconsistent with an obligation of this Agreement, or that the measure nullifies or impairs benefits within the meaning of Article 28.3.1(c) (Scope), the requesting Appendix Party may so notify the other Appendix Party in writing. The notification shall include identification of the measure at issue and an indication of the legal basis for the complaint. The Appendix Party that made the notification may request the establishment of a panel pursuant to Article 7.4 at any time after the date that is 14 days after the date of receipt of the notification, provided that, on request of either Appendix Party, the Appendix Parties shall enter into consultations with respect to the matter no later than 14 days after the date of receipt of the notification.

5. If the Appendix Parties hold consultations under paragraph 4, either Appendix Party may request additional consultations no later than 14 days after the date of receipt of the notification under paragraph 4. If such a request is made, the Appendix Parties shall hold additional consultations promptly thereafter. In that event, the Appendix Party that made the notification may request the establishment of a panel pursuant to Article 7.4 at any time after the date that is 30 days after the date of receipt of the notification.

6. Paragraphs 5 through 8 of Article 28.5 (Consultations) shall apply, mutatis mutandis,30 to consultations under paragraphs 4 and 5.

Article 9

1. The Appendix Parties hereby establish a special bilateral Committee on Motor Vehicles (Committee), composed of representatives of the relevant authorities of each Appendix Party. The Committee shall:

(a) monitor implementation of the obligations in this Agreement with respect to motor vehicles;

(b) consult to resolve issues affecting trade and investment between the Appendix Parties that an Appendix Party raises with respect to the development and implementation of measures relating to motor vehicles and motor vehicle parts;

(c) exchange information on post-implementation reviews described in Article 2.4;

(d) facilitate increased cooperation with respect to emerging issues, including the manufacture, importation, sale and operation of motor vehicles using alternative fuels, and cooperation between the Appendix Parties with respect to issues concerning other markets;

(e) monitor bilateral, regional and global market developments and trends in trade, investment, production, sales and distribution with respect to motor vehicles and motor vehicle parts;

(f) provide opportunities for input from interested persons of the Appendix Parties on matters relevant to the Committee's work, as the Appendix Parties may agree; and

(g) address other issues, if the Appendix Parties agree.

2. The Committee shall meet on request of either Appendix Party and, unless the Appendix Parties decide otherwise, no less than once a year. Meetings shall take place in such locations and through such means as the Appendix Parties decide.


APPENDIX D-2

BETWEEN JAPAN AND CANADA ON MOTOR VEHICLE TRADE

Article 1

1. For the purposes of this Appendix:

Appendix Party means either Japan or Canada, as the case may be; motor vehicle means any good classified under heading 87.03; and

originating motor vehicle means any motor vehicle qualifying as originating under Chapter 3 (Rules of Origin and Origin Procedures).

2. No Party other than an Appendix Party shall have recourse to dispute settlement under Chapter 28 (Dispute Settlement) for any matter arising under this Appendix or to dispute settlement under Article 4 for any matter arising under this Agreement. No Appendix Party shall have recourse to dispute settlement under Chapter 28 (Dispute Settlement) for nullification or impairment within the meaning of Article 28.3.1(c) (Scope) for any matter arising under Article 3 or Article 4 of this Appendix.

Article 2

An Appendix Party shall accord to the other Appendix Party treatment no less favourable than that accorded to a Party other than the other Appendix Party with respect to technical regulations, standards or conformity assessment procedures on motor vehicles that are adopted or applied in accordance with a bilateral agreement provided for in this Agreement.

Article 3

An Appendix Party may apply a transitional safeguard measure on originating motor vehicles from the other Appendix Party classified under heading 87.03, during the transition period only, in accordance with the provisions set out in Chapter 6 (Trade Remedies), with the following procedural modifications:

(a) In lieu of the definition of transition period provided for in Article 6.1 (Definitions), the following definition shall apply:

transition period means the period beginning on the date of entry into force of this Agreement with respect to Japan and Canada and ending on the date that is 12 years after the end of the period of the staged tariff elimination for a particular good.

(b) In lieu of Article 6.4.2 (Standards for a Transitional Safeguard Measure), the following shall apply:

Neither Appendix Party shall apply a transitional safeguard measure for a period exceeding three years, except that the period may be extended by up to two years if the competent authority of the Appendix Party that applies the measure determines, in conformity with the procedures set out in Article 6.5 (Investigation Procedures and Transparency Requirements), that the transitional safeguard measure continues to be necessary to prevent or remedy serious injury and to facilitate adjustment.

(c) Paragraphs 4 and 6 of Article 6.4 (Standards for a Transitional Safeguard Measure) shall not apply.

(d) In lieu of paragraphs 1 and 2 of Article 6.7 (Compensation), the following shall apply:

(i) An Appendix Party applying a transitional safeguard measure shall consult with the other Appendix Party in order to mutually agree on appropriate trade liberalising compensation in the form of concessions that have substantially equivalent trade effects or equivalent to the value of the additional duties expected to result from the transitional safeguard measure. The Appendix Party shall provide an opportunity for those consultations no later than 30 days after the application of the transitional safeguard measure;

(ii) If the consultations under subparagraph (d)(i) do not result in an agreement on trade liberalising compensation within 30 days after the consultations begin, the Appendix Party against whose good the transitional safeguard measure is applied may suspend the application of substantially equivalent concessions to the trade of the Appendix Party applying the transitional safeguard measure; and

(iii) The right of suspension referred to in subparagraph (d)(ii) shall not be exercised for the first 24 months during which a transitional safeguard measure is in effect, provided that the transitional safeguard measure conforms to the provisions of this Agreement.

Article 4

1. For the purposes of this Article, the definitions set out in Article 28.1 (Definitions) shall apply, mutatis mutandis.

2. With respect to any matter described in Article 28.3 (Scope) that relates to motor vehicles, an Appendix Party may initiate the dispute settlement procedures set out in this Article in lieu of the procedures provided for in Article 28.4 (Choice of Forum), Article 28.5 (Consultations), Article 28.6 (Good Offices, Conciliation and Mediation), Article 28.7 (Establishment of a Panel), Article 28.8 (Terms of Reference), Article 28.9 (Composition of Panels), Article 28.10 (Qualifications of Panellists), Article 28.11 (Roster of Panel Chairs and Party Specific Lists), Article 28.12 (Function of Panels), Article 28.13 (Rules of Procedure for Panels), Article

28.14 (Third Party Participation), Article 28.15 (Role of Experts), Article 28.16 (Suspension or Termination of Proceedings), Article 28.17 (Initial Report), Article 28.18 (Final Report), Article 28.19 (Implementation of Final Report), Article 28.20 (Non-Implementation – Compensation and Suspension of Benefits) and Article 28.21 (Compliance Review).

3.

(a) An Appendix Party may request consultations with the other Appendix Party with respect to any matter described in paragraph 2. The Appendix Party making the request for consultations shall do so in writing, and shall set out the reasons for the request, including identification of the actual or proposed measure or other matter at issue and an indication of the legal basis for the complaint. The requesting Appendix Party shall circulate the request concurrently to the other Parties through the overall contact points designated under Article 27.5.1 (Contact Points).

(b) The Appendix Party to which a request for consultations is made shall, unless the Appendix Parties agree otherwise, reply in writing to the request no later than seven days after the date of its receipt of the request. That Appendix Party shall circulate its reply concurrently to the other Parties through the overall contact points and enter into consultations in good faith.

(c) Unless the Appendix Parties agree otherwise, they shall enter into consultations no later than 15 days after the date of receipt of the request.

(d) Unless the Appendix Parties agree otherwise, paragraphs 5 through 8 of Article 28.5 (Consultations) shall apply, mutatis mutandis, to the consultations under this paragraph.

4.

(a) An Appendix Party that requested consultations under paragraph 3(a) may request, by means of a written notice addressed to the other Appendix Party, the establishment of a panel if the Appendix Parties fail to resolve the matter within a period of 30 days after the date of receipt of the request for consultations under paragraph 3(a).

(b) The complaining Appendix Party shall circulate the request concurrently to the other Parties through the overall contact points designated under Article 27.5.1 (Contact Points).

(c) Paragraphs 3, 4 and 7 of Article 28.7 (Establishment of a Panel) shall apply, mutatis mutandis, to the establishment of a panel. Unless the Appendix Parties agree otherwise, the panel shall be composed in a manner consistent with this Article and, subject to the time frames set out in paragraph 6, the Rules of Procedure.

5.

(a) Unless the Appendix Parties agree otherwise no later than 15 days after the date of delivery of the request for the establishment of a panel, the terms of reference shall be to:

(i) examine, in the light of the relevant provisions of this Agreement, the matter referred to in the request for the establishment of a panel under paragraph 4(a); and

(ii) make findings and determinations, and any jointly requested recommendations, together with its reasons therefor, as provided for in Article 28.17.4 (Initial Report) as applied pursuant to paragraph 8.

(b) If, in its request for the establishment of a panel, the complaining Appendix Party claims that a measure nullifies or impairs benefits within the meaning of Article 28.3.1(c) (Scope), the terms of reference shall so indicate.

6. (a) A panel shall be composed of three members.

(b) Unless the Appendix Parties agree otherwise, they shall apply the following procedures to compose a panel:

(i) Within a period of 15 days after the date of delivery of the request for the establishment of a panel under paragraph 4(a), the complaining Appendix Party, on the one hand, and the responding Appendix Party, on the other, shall each appoint a panellist and notify each other of those appointments.

(ii) If the complaining Appendix Party fails to appoint a panellist within the period specified in subparagraph (b)(i), the dispute settlement proceedings shall lapse at the end of that period.

(iii) If the responding Appendix Party fails to appoint a panellist within the period specified in subparagraph (b)(i), the complaining Appendix Party shall select the panellist not yet appointed:

(A) from the responding Appendix Party's list established under Article 28.11.9 (Roster of Panel

Chairs and Party Specific Lists);

(B) if the responding Appendix Party has not established a list under Article 28.11.9 (Roster of

Panel Chairs and Party Specific Lists), from the roster of panel chairs established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists); or

(C) if the responding Appendix Party has not established a list under Article 28.11.9 (Roster of Panel Chairs and Party Specific Lists) and no roster of panel chairs has been established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists), by random selection from a list of three candidates, who are not nationals of the complaining Appendix Party, nominated by the complaining Appendix Party, no later than 20 days after the date of delivery of the request for the establishment of a panel under paragraph 4(a).

(iv) For appointment of the third panellist, who shall serve as chair:

(A) the Appendix Parties shall endeavour to agree on the appointment of a chair;

(B) if the Appendix Parties fail to appoint a chair under subparagraph (b)(iv)(A) within a period of 15 days after the date of delivery of the request for the establishment of the panel under paragraph 4(a), the Appendix Parties shall select the chair by random selection from the roster established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists) within a period of 20 days after the date of delivery of the request for the establishment of the panel; or

(C) if a roster has not been established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists), and subparagraphs (b)(iv)(A) and (B) cannot apply, each Appendix Party may nominate up to three candidates. The chair shall be randomly selected from those candidates that are nominated within a period of 20 days after the date of delivery of the request for the establishment of a panel under paragraph 4(a).

(D) The chair shall not be a national of either Appendix Party and any nationals of the Appendix Parties appointed to the roster established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists) shall be excluded from a selection process under subparagraph (b)(iv).

(v) If a panellist selected under subparagraph (b)(iii) or (iv)(B) is unable to serve on the panel, the Appendix Parties shall meet no later than five days after the date of learning that the panellist is unavailable to select another panellist from among the remaining members of the list (in the case of subparagraph (b)(iii)) or the roster (in the case of subparagraph (b)(iv)(B)).

(vi) If a panellist appointed under this paragraph resigns or becomes unable to serve on the panel, either during the course of proceeding or when the panel is reconvened under paragraph 13 or Article 28.21 (Compliance Review) as applied under paragraph 12, 17 or 18, a replacement panellist shall be appointed within 12 days in accordance with the selection procedures prescribed in this subparagraph for the appointment of the original panellist. The replacement shall have all the powers and duties of the original panellist. The work of the panel shall be suspended pending the appointment of the replacement panellist, and all time frames set out in this Article and in the Rules of Procedure shall be extended by the amount of time that the work was suspended.

(vii) Paragraphs 4, 5 and 10 of Article 28.9 (Composition of Panels) shall apply, mutatis mutandis,to the selection procedures.

7. All panellists shall meet the requirements set out in Article 28.10.1 (Qualifications of Panellists). An individual shall not serve as a panellist for a dispute in which that person has participated under Article 28.6 (Good Offices, Conciliation, and Mediation) as applied pursuant to paragraph 8.

8. Unless the Appendix Parties agree otherwise, Article 28.4 (Choice of Forum), Article 28.6 (Good Offices, Conciliation and Mediation), Article 28.12 (Function of Panels), Article 28.15 (Role of Experts), Article 28.16 (Suspension or Termination of Proceedings), Article 28.17 (Initial Report) and Article 28.18 (Final Report) shall apply, mutatis mutandis,to panel proceedings under this Article, except that:

(a) with respect to Article 28.17.3 (Initial Report), the panel shall present an initial report to the Appendix Parties no later than 100 days after the date of the appointment of the last panellist;

(b) with respect to Article 28.17.4 (Initial Report), the panel shall also make a determination as to whether the non-conformity or the nullification or impairment, if any, has materially affected the sale, offering for sale, purchase, transportation, distribution or use of originating motor vehicles from the complaining Appendix Party;

(c) with respect to Article 28.17.7 (Initial Report), an Appendix Party may submit written comments to the panel on its initial report no later than 10 days after the presentation of the initial report or within another period as the Appendix Parties may agree; and

(d) with respect to Article 28.18.1 (Final Report), the panel shall present a final report to the Appendix Parties, including any separate opinions on matters not unanimously agreed, no later than 20 days after presentation of the initial report. After taking any steps to protect confidential information, and no later than 15 days after the presentation of the final report, the Appendix Parties shall release the final report to the public.

9. Unless the Appendix Parties agree otherwise, paragraphs 1 and 2 of Article 28.19 (Implementation of Final Report) shall apply, mutatis mutandis,to the implementation of the final report.

10. (a) Unless the Appendix Parties agree otherwise, if in its final report the panel determines that:

(i) (A) the measure at issue is inconsistent with an Appendix Party's obligations in this Agreement;

(B) an Appendix Party has otherwise failed to carry out its obligations in this Agreement; or

(C) the measure at issue is causing nullification or impairment within the meaning of Article 28.3.1(c) (Scope); and

(ii) the non-conformity or the nullification or impairment that the panel has determined to exist has materially affected the sale, offering for sale, purchase, transportation, distribution or use of originating motor vehicles from the complaining Appendix Party, the complaining Appendix Party may suspend the application to the responding Appendix Party of benefits in accordance with this paragraph, paragraph 11 and paragraphs 13 through 16.

(b) Unless the Appendix Parties agree otherwise, the responding Appendix Party shall have a reasonable period of time in which to eliminate the non-conformity or nullification or impairment if it is not practicable to do so immediately.

(c) Unless the Appendix Parties agree otherwise, the reasonable period of time shall be:

(i) six months from the presentation of the final report under Article 28.18.1 (Final Report) as applied pursuant to paragraph 8; or

(ii) if elimination of the non-conformity or nullification or impairment requires amendment of laws or regulations adopted by the Diet of Japan or the Parliament of Canada, or the legislative body of local subdivision, 12 months from the presentation of the final report.

11. (a) The responding Appendix Party shall, if requested by the complaining Appendix Party, enter into negotiations with the complaining Appendix Party no later than 15 days after receipt of that request, with a view to developing mutually acceptable compensation, if:

(i) the responding Appendix Party has notified the complaining Appendix Party that it does not intend to eliminate the non \conformity or the nullification or impairment; or

(ii) following the expiry of the reasonable period of time set out in paragraph 10(c), there is disagreement between the Appendix Parties as to whether the responding Appendix Party has eliminated the non-conformity or the nullification or impairment.

(b) A complaining Appendix Party may suspend benefits in accordance with subparagraph (c) if the Appendix Parties have:

(i) been unable to agree on compensation within a period of 30 days after the period for developing compensation has begun in accordance with subparagraph (a); or

(ii) agreed on compensation but the complaining Appendix Party considers that the responding Appendix Party has failed to observe the terms of the agreement.

(c) A complaining Appendix Party may, at any time after the conditions set out in subparagraph (b) are met in relation to the complaining Appendix Party, provide a written notice to the responding Appendix Party that it intends to suspend benefits under paragraph 14 or 15. The notice shall specify the level of benefits that the complaining Appendix Party proposes to suspend. The complaining Appendix Party may begin suspending benefits in accordance with paragraph 14 or 15 after the date on which it provides the notice.

(d) Compensation and suspension of benefits shall be temporary measures. None of these measures is preferred to full implementation through elimination of the non-conformity or the nullification or impairment. Compensation and suspension of benefits shall only be applied until the responding Appendix Party has eliminated the non-conformity or the nullification or impairment, or until a mutually satisfactory solution is reached.

12. Unless the Appendix Parties agree otherwise, if in its final report the panel determines that the non-conformity or the nullification or impairment that the panel has determined to exist under paragraph 10(a)(i) has not materially affected the sale, offering for sale, purchase, transportation, distribution or use of originating motor vehicles from the complaining Appendix Party, the procedures provided for in paragraphs 3 through 7 of Article 28.19 (Implementation of Final Report), Article 28.20 (Non-Implementation – Compensation and Suspension of Benefits) and Article 28.21 (Compliance Review) shall apply, mutatis mutandis.

13. (a) If the responding Appendix Party considers that:

(i) the level of benefits proposed to be suspended under paragraph 15 is manifestly excessive; or

(ii) it has eliminated the non-conformity or the nullification or impairment that the panel has determined to exist, it may, no later than 30 days after the date of delivery of the written notice provided by the complaining Appendix Party under paragraph 11(c), request that the panel be reconvened to consider the matter. The responding Appendix Party shall deliver its request in writing to the complaining Appendix Party. The panel shall reconvene as soon as possible after the date of delivery of the request and shall present its determination to the Appendix Parties no later than 90 days after delivery of the request.

(b) If the panel determines that the level of benefits the complaining Appendix Party proposes to suspend under paragraph 15 is manifestly excessive, it shall determine the level of benefits that the complaining Appendix Party may suspend. The panel shall determine:

(i) the level of benefits of equivalent effect, as set out in Article 28.20.5 (Non-Implementation – Compensation and Suspension of Benefits); and

(ii) if the prevailing most-favoured-nation applied rate of customs duty imposed by the complaining Appendix Party on motor vehicles classified under heading 87.03 is zero per cent, the level of benefits equivalent to the effect of application by the responding Appendix Party of its prevailing most-favoured-nation applied rate of customs duty on motor vehicles classified under heading 87.03.

14. Unless the panel has determined that the responding Appendix Party has eliminated the non-conformity or the nullification or impairment, 30 days after the later of:

(a) the date on which the complaining Appendix Party provides the notice under paragraph 11(c); or

(b) if the responding Appendix Party requests that the panel be reconvened to consider the matter under paragraph 13(a)(ii), the date that the panel issues its determination under paragraph 13, the complaining Appendix Party may increase the rate of customs duty on originating motor vehicles from the responding Appendix Party classified under heading 87.03 to a level not to exceed the prevailing most-favoured nation applied rate of customs duty on those motor vehicles, for a period of up to 100 days following the 30-day period.

15. Unless the panel has determined that the responding Appendix Party has eliminated the non-conformity or the nullification or impairment:

(a) if the panel determines the level of benefits under paragraph 13(b), 30 days after the later of the date on which the complaining Appendix Party provides the notice under paragraph 11(c) or the date that the panel issues its determination under paragraph 13, the complaining Appendix Party may:

(i) increase the rate of customs duty on originating motor vehicles from the responding Appendix Party classified under heading 87.03 up to the level the panel has determined under paragraph 13(b)(i); or

(ii) if the prevailing most-favoured-nation applied rate of customs duty imposed by the complaining Appendix Party on motor vehicles under heading 87.03 is zero per cent, suspend the application to the responding Appendix Party of benefits with respect to originating goods from the responding Appendix Party:

(A) up to the level the panel has determined under paragraph 13(b)(i); and

(B) up to the level the panel has determined under paragraph 13(b)(ii) for a period of up to 100 days following the 30-day period, and

(b) if the responding Appendix Party does not request that the panel be reconvened to consider the matter under paragraph 13(a)(i) or the panel has not determined the level under paragraph 13(b), after the 30-day period, the complaining Appendix Party may suspend the application to the responding Appendix Party of benefits up to the level the complaining Appendix Party has proposed to suspend under paragraph 11(c), provided that the increased rate of customs duty applied to any goods under this paragraph shall not exceed the prevailing most-favoured-nation applied rate of customs duty on such goods.

16. As long as the complaining Appendix Party is applying the increased rate of customs duty under paragraph 14, it shall not suspend the application to the responding Appendix Party of benefits under paragraph 15.

17. Unless the Appendix Parties agree otherwise, Article 28.21 (Compliance Review) shall apply, mutatis mutandis,to compliance review.

18. If a final report is presented after the 10-year period beginning on the date of entry into force of this Agreement, the procedures provided for in paragraphs 3 through 7 of Article 28.19 (Implementation of Final Report), Article 28.20 (Non Implementation – Compensation and Suspension of Benefits) and Article 28.21 (Compliance Review) shall apply, mutatis mutandis, in lieu of the procedures provided for in paragraphs 10 through 17.

Article 5

1. The Appendix Parties hereby establish a special bilateral Committee on Motor Vehicles (Committee), composed of representatives of the relevant authorities of each Appendix Party. The Committee shall:

(a) monitor implementation of the obligations in this Agreement with respect to motor vehicles;

(b) consult to resolve issues affecting trade and investment between the Appendix Parties that an Appendix Party raises with respect to the development and implementation of measures relating to motor vehicles and motor vehicle parts;

(c) facilitate increased cooperation with respect to emerging issues, including the manufacture, importation, sale and operation of motor vehicles using alternative fuels, and cooperation between the Appendix Parties with respect to issues concerning other markets;

(d) monitor bilateral, regional and global market developments and trends in trade, investment, production, sales and distribution with respect to motor vehicles and motor vehicle parts;

(e) provide opportunities for input from interested persons of the Appendix Parties on matters relevant to the Committee's work, as the Appendix Parties may agree; and

(f) address other issues, if the Appendix Parties agree.

2. The Committee shall meet at mutually agreed times. Meetings shall take place in such locations and through such means as the Appendix Parties decide.


Malaysia

ANNEX 2-D

TARIFF SCHEDULE OF MALAYSIA GENERAL NOTES

1. The provisions of this Schedule are generally expressed in terms of the Malaysian Customs Duties Order (MCDO), and the interpretation of the provisions of this Schedule, including the product coverage of subheadings of this Schedule, shall be governed by the General Notes, Section Notes and Chapter Notes of the MCDO. To the extent that provisions of this Schedule are identical to the corresponding provisions of MCDO, the provisions of this Schedule shall have the same meaning as the corresponding provisions of MCDO.

2. The base rates of duty set out in this Schedule reflect Malaysia's Most Favoured-Nation (MFN) rates of duty in effect on January 1, 2010.

3. In this Schedule, rates of duty expressed in monetary units shall be rounded down to the nearest hundredth of a Malaysian Ringgit.

4. The following staging categories shall apply to the elimination of customs duties by Malaysia pursuant to Article 2.4.2 (Elimination of Customs Duties):

(a) customs duties on originating goods provided for in the items in staging category EIF shall be eliminated entirely, and these goods shall be duty-free on the date of entry into force of this Agreement for Malaysia;

(b) customs duties on originating goods provided for in the items in staging category B3 shall be eliminated in three annual stages, and these goods shall be duty-free effective January 1 of year 3;

(c) customs duties on originating goods provided for in the items in staging category B6 shall be eliminated in six annual stages, and these goods shall be duty-free effective January 1 of year 6;

(d) customs duties on originating goods provided for in the items in staging category B8 shall be eliminated in eight annual stages, and these goods shall be duty-free effective January 1 of year 8;

(e) customs duties on originating goods provided for in the items in staging category B11 shall be eliminated in 11 annual stages, and these goods shall be duty-free effective January 1 of year 11;

(f) customs duties on originating goods provided for in the items in staging category B13 shall be eliminated in 13 annual stages, and these goods shall be duty-free effective January 1 of year 13;

(g) customs duties on originating goods provided for in the items in staging category B16 shall be eliminated in 16 annual stages, and these goods shall be duty-free effective January 1 of year 16; and

(h) customs duties on originating goods provided for in the items in staging category TRQ shall be governed by the terms of the TRQ applicable to that tariff item, as outlined in Appendix A (Tariff Rate Quotas of Malaysia) to Malaysia's Schedule to Annex 2-D .

5. The annual stages referred to in paragraph 4 for the elimination or reduction of customs duties shall be equal, annual stages, except:

(a) as provided in paragraphs 3(b)(i), 4(a)(ii) and 4(b)(ii) in Section A of this Annex; or

(b) as otherwise provided in paragraph 4.


TARIFF SCHEDULE OF MALAYSIA (HS2012)

APPENDIX A

TARIFF RATE QUOTAS OF MALAYSIA

Section A: General Provisions

1. This Appendix sets out the modifications to the Malaysian Customs Duties Order (MCDO) that reflect the TRQs that Malaysia shall apply to certain originating goods under this Agreement. In particular, originating goods of Parties included under this Appendix shall be subject to the rates of duty set out in this Appendix in lieu of the rates of duty specified in Chapters 1 through 97 of the MCDO. Notwithstanding any other provision of the MCDO, originating goods of a Party in the quantities described in this Appendix shall be permitted entry into the territory of Malaysia as provided in this Appendix. Furthermore, any quantity of originating goods imported from a Party under a TRQ provided for in this Appendix shall not be counted toward the in-quota quantity of any TRQ provided for such goods under Malaysia's WTO tariff schedule or any other trade agreement.

2. The product or products covered by each TRQ set out in Section B are informally identified in the title to the paragraph setting out the TRQ. These titles are included solely to assist readers in understanding this Appendix and shall not alter or supersede the coverage for each TRQ established through identification of covered codes of the Harmonized Schedule of Malaysia.

3. Malaysia shall administer all TRQs provided for in this Agreement through an import licensing system.

4. Each TRQ set out below in Section B of this Appendix shall apply to an aggregate quantity of originating goods.

5. For the purposes of this Appendix, the term "kilogramme" shall be abbreviated as "kg". The term "unit", referred to in TRQ-MY 12 through TRQ MY15 means one egg, and shall be abbreviated as "u".

Section B: TRQs

6. TRQ-MY1: Live Poultry, Fowls of the Species Gallus Domesticus, Weighing Not More Than 185g: Other

(a) The TRQ described in this paragraph is designated in the Schedule of Malaysia to Annex 2-D (Tariff Commitments) with the designation "TRQ-MY1".

(b) The aggregate quantity of originating goods described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 2, the quantity shall increase by one per cent per year, compounded annually.

(c) Customs duties on originating goods described in subparagraph (d) entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be reduced in 16 equal annual stages, from the Base Rate of 20 per cent to 10 per cent, and these duties shall remain at 10 per cent effective January 1 of year 16.

(d) Subparagraphs (a) through (c) apply to the following MCDO provision: 010511900.

7. TRQ-MY2: Live Poultry, Fowls of the Species Gallus Domesticus, Weighing Not More Fowls of Species Gallus Domesticus Weighing Not More Than 2,000g

(a) The TRQ described in this paragraph is designated in Malaysia's Schedule to Annex 2-D (Tariff Commitments) as "TRQ-MY2".

(b) The aggregate quantity of originating goods described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 2, the quantity shall increase by one per cent per year, compounded annually.

(c) Customs duties on originating goods described in subparagraph (d) entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be reduced in six equal annual stages, from the Base Rate of 20 per cent to 10 per cent, and these duties shall remain at 10 per cent effective January 1 of year 6.

(d) Subparagraphs (a) through (c) apply to the following MCDO provision: 010594190.

8. TRQ-MY3: Meat of Swine, Fresh Or Chilled – Carcasses and Half Carcasses

(a) The TRQ described in this paragraph is designated in Malaysia's Schedule to Annex 2-D (Tariff Commitments) as "TRQ-MY3".

(b) The aggregate quantity of originating goods described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 2, the quantity shall increase by one per cent per year, compounded annually.

(c) Customs duties on originating goods described in subparagraph (d) entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be removed in accordance with staging category B16 in the General Notes to the Schedule of Malaysia to Annex 2-D (Tariff Commitments).

(d) Subparagraphs (a) through (c) apply to the following MCDO provision: 020311000.

9. TRQ-MY4: Meat of Swine, Frozen – Carcasses and Half-Carcasses

(a) The TRQ described in this paragraph is designated in Malaysia's Schedule to Annex 2-D (Tariff Commitments) as "TRQ-MY4".

(b) The aggregate quantity of originating goods described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 2, the quantity shall increase by one per cent per year, compounded annually.

(c) Customs duties on originating goods described in subparagraph (d) entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be removed in accordance with staging category B16 in the General Notes to the Schedule of Malaysia to Annex 2-D (Tariff Commitments).

(d) Subparagraphs (a) through (c) apply to the following MCDO provision: 020321000.

10. TRQ-MY5: Meat of Fowls of the Species Gallus Domesticus Not Cut in Pieces, Fresh or Chilled

(a) The TRQ described in this paragraph is designated in Malaysia's Schedule to Annex 2-D (Tariff Commitments) as "TRQ-MY5".

(b) The aggregate quantity of originating goods described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 2, the quantity shall increase by one per cent per year, compounded annually.

(c) Customs duties on originating goods described in subparagraph (d) entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be reduced in 16 equal annual stages, from the Base Rate of 40 per cent to 20 per cent, and these duties shall remain at 20 per cent effective January 1 of year 16.

(d) Subparagraphs (a) through (c) apply to the following MCDO provision: 020711000.

11. TRQ-MY6: Meat of Fowls of the Species Gallus Domesticus Not Cut in Pieces, Frozen

(a) The TRQ described in this paragraph is designated in Malaysia's Schedule to Annex 2-D (Tariff Commitments) as "TRQ-MY6".

(b) The aggregate quantity of originating goods described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 2, the quantity shall increase by one per cent per year, compounded annually.

(c) Customs duties on originating goods described in subparagraph (d) entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be reduced in 16 equal annual stages, from the Base Rate of 40 per cent to 20 per cent, and these duties shall remain at 20 per cent effective January 1 of year 16.

(d) Subparagraphs (a) through (c) apply to the following MCDO provision: 020712000.

12. TRQ-MY7: Edible Cuts and Offal of the Species Gallus Domesticus, Fresh or Chilled

(a) The TRQ described in this paragraph is designated in Malaysia's Schedule to Annex 2-D (Tariff Commitments) as "TRQ-MY7".

(b) The aggregate quantity of originating goods described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 2, the quantity shall increase by one per cent per year, compounded annually.

(c) Customs duties on originating goods described in subparagraph (d) entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be reduced in six equal annual stages, from the Base Rate of 40 per cent to 20 per cent, and these duties shall remain at 20 per cent effective January 1 of year 6.

(d) Subparagraphs (a) through (c) apply to the following MCDO provision: 020713000.

13. TRQ-MY8: Edible Cuts and Offal of the Species Gallus Domesticus, Frozen

(a) The TRQ described in this paragraph is designated in Malaysia's Schedule to Annex 2-D (Tariff Commitments) as "TRQ-MY8".

(b) The aggregate quantity of originating goods described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 2, the quantity shall increase by one per cent per year, compounded annually.

(c) Customs duties on originating goods described in subparagraph (d) entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be reduced in 11 equal annual stages, from the Base Rate of 40 per cent to 20 per cent, and these duties shall remain at 20 per cent effective January 1 of year 11.

(d) Subparagraphs (a) through (c) apply to the following MCDO provision: 020714000.

14. TRQ-MY9: Milk, of a Fat Content, By Weight, Not Exceeding 1 Per Cent: In Liquid Form

(a) The TRQ described in this paragraph is designated in Malaysia's Schedule to Annex 2-D (Tariff Commitments) as "TRQ-MY9".

(b) The aggregate quantity of originating goods described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 2, the quantity shall increase by one per cent per year, compounded annually.

(c) Customs duties on originating goods described in subparagraph (d) entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be removed in accordance with staging category B16 in the General Notes to the Schedule of Malaysia to Annex 2-D (Tariff Commitments).

(d) Subparagraphs (a) through (c) apply to the following MCDO provision: 040110100.

15. TRQ-MY10: Milk, of a Fat Content, By Weight, Exceeding 1 Per Cent but Not Exceeding 6 Per Cent: In Liquid Form

(a) The TRQ described in this paragraph is designated in Malaysia's Schedule to Annex 2-D (Tariff Commitments) as "TRQ-MY10".

(b) The aggregate quantity of originating goods described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 2, the quantity shall increase by one per cent per year, compounded annually.

(c) Customs duties on originating goods described in subparagraph (d) entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be removed in accordance with staging category B16 in the General Notes to the Schedule of Malaysia to Annex 2-D (Tariff Commitments).

(d) Subparagraphs (a) through (c) apply to the following MCDO provision: 040120100.

16. TRQ-MY11: Milk, of a Fat Content, By Weight, Exceeding 6 Per Cent: In Liquid Form

(a) The TRQ described in this paragraph is designated in Malaysia's Schedule to Annex 2-D (Tariff Commitments) as "TRQ-MY11".

(b) The aggregate quantity of originating goods described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 2, the quantity shall increase by one per cent per year, compounded annually.

(c) Customs duties on originating goods described in subparagraph (d) entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be removed in accordance with staging category B16 in the General Notes to the Schedule of Malaysia to Annex 2-D (Tariff Commitments).

(d) Subparagraphs (a) through (c) apply to the following MCDO provision: 040140110.

17. TRQ-MY12: Fertilised Eggs for Incubation: Of Fowls of the Species Gallus Domesticus

(a) The TRQ described in this paragraph is designated in Malaysia's Schedule to Annex 2-D (Tariff Commitments) as "TRQ-MY12".

(b) The aggregate quantity of originating goods described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 2, the quantity shall increase by one per cent per year, compounded annually.

(c) Customs duties on originating goods described in subparagraph (d) entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be reduced in 11 equal annual stages, from the Base Rate of 50 per cent to 25 per cent, and these duties shall remain at 25 per cent effective January 1 of year 11.

(d) Subparagraphs (a) through (c) apply to the following MCDO provision: 040711000.

18. TRQ-MY13: Fertilised Eggs For Incubation: Of Ducks

(a) The TRQ described in this paragraph is designated in Malaysia's Schedule to Annex 2-D (Tariff Commitments) as "TRQ-MY13".

(b) The aggregate quantity of originating goods described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 2, the quantity shall increase by one per cent per year, compounded annually.

(c) Customs duties on originating goods described in subparagraph (d) entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be reduced in 11 equal annual stages, from the Base Rate of 50 per cent to 25 per cent, and these duties shall remain at 25 per cent effective January 1 of year 11.

(d) Subparagraphs (a) through (c) apply to the following MCDO provision: 040719100.

19. TRQ-MY14: Other Eggs: Of Fowls of the Species Gallus Domesticus

(a) The TRQ described in this paragraph is designated in Malaysia's Schedule to Annex 2-D (Tariff Commitments) as "TRQ-MY14".

(b) The aggregate quantity of originating goods described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 2, the quantity shall increase by 1 per cent per year, compounded annually.

(c) Customs duties on originating goods described in subparagraph (d) entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be reduced in 11 equal annual stages, from the Base Rate of 50 per cent to 25 per cent, and these duties shall remain at 25 per cent effective January 1 of year 11.

(d) Subparagraphs (a) through (c) apply to the following MCDO provisions: 040721000 and 040790100.

20. TRQ-MY15: Other Eggs: Of Ducks

(a) The TRQ described in this paragraph is designated in Malaysia's Schedule to Annex 2-D (Tariff Commitments) as "TRQ-MY15".

(b) The aggregate quantity of originating goods described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 2, the quantity shall increase by 1 per cent per year, compounded annually.

(c) Customs duties on originating goods described in subparagraph (d) entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be reduced in 11 equal annual stages, from the Base Rate of 50 per cent to 25 per cent, and these duties shall remain at 25 per cent effective January 1 of year 11.

(d) Subparagraphs (a) through (c) apply to the following MCDO provisions: 040729100 and 040790200.


Mexico

ANNEX 2-D

TARIFF SCHEDULE OF MEXICO GENERAL NOTES

1. The provisions of this Schedule are generally expressed in terms of Mexico's Tariff Schedule of the General Import and Export Duties Law (Tarifa de la Ley de los Impuestos Generales de Importación y de Exportación (LIGIE)), and the interpretation of the provisions of this Schedule, including the product coverage of subheadings of this Schedule, shall be governed by the General Notes, Section Notes and Chapter Notes of the LIGIE. To the extent that provisions of this Schedule are identical to the corresponding provisions of the LIGIE, the provisions of this Schedule shall have the same meaning as the corresponding provisions of the LIGIE.

2. Except as otherwise provided in this Schedule, the base rates of duty set out in this Schedule reflect Mexico's Most-Favoured-Nation (MFN) rates of duty in effect on January 1, 2010. For items identified with an asterisk (*), the applicable base rates of duty are those set forth in this Schedule.

3. In this Schedule, rates of duty expressed in monetary units shall be rounded down to the nearest 0.01 of a US dollar (USD).

4. The following staging categories shall apply to the elimination or reduction of customs duties by Mexico pursuant to Article 2.4.2 (Elimination of Customs Duties):

(a) customs duties on originating goods provided for in the items in staging category EIF shall be eliminated entirely, and these goods shall be duty-free on the date of entry into force of this Agreement for Mexico;

(b) customs duties on originating goods provided for in the items in staging category B3 shall be eliminated in three annual stages, and these goods shall be duty-free effective January 1 of year 3;

(c) customs duties on originating goods provided for in the items in staging category B5 shall be eliminated in five annual stages, and these goods shall be duty-free effective January 1 of year 5;

(d) customs duties on originating goods provided for in the items in staging category B8 shall be eliminated in eight annual stages, and these goods shall be duty-free effective January 1 of year 8;

(e) customs duties on originating goods provided for in the items in staging category B10 shall be eliminated in 10 annual stages, and these goods shall be duty-free effective January 1 of year 10;

(f) customs duties on originating goods provided for in the items in staging category B12 shall be eliminated in 12 annual stages, and these goods shall be duty-free effective January 1 of year 12;

(g) customs duties on originating goods provided for in the items in staging category B13 shall be eliminated in 13 annual stages, and these goods shall be duty-free effective January 1 of year 13;

(h) customs duties on originating goods provided for in the items in staging category B15 shall be eliminated in 15 annual stages, and these goods shall be duty-free effective January 1 of year 15;

(i) customs duties on originating goods provided for in the items in staging category B16 shall be eliminated in 16 annual stages, and these goods shall be duty-free effective January 1 of year 16;

(j) customs duties on originating goods provided for in the items in staging category D shall be the rate of customs duty applied under the WTO Agreement;

(k) customs duties on originating goods provided for in the items in staging category MX10 shall be maintained at the base rate during year 1 through year 5 and shall be eliminated in five annual stages beginning in year 6, and these goods shall be duty-free effective January 1 of year 10;

(l) customs duties on originating goods provided for in the items in staging category MX11 shall be 16 per cent during year 1, and shall be eliminated in 10 annual stages beginning in year 2, and these goods shall be duty-free effective January 1 of year 11;

(m) customs duties on originating goods provided for in the items in staging category MX13 shall be maintained at the base rate during year 1 through year 3 and shall be eliminated in 10 annual stages beginning in year 4, and these goods shall be duty-free effective January 1 of year 13;

(n) customs duties on originating goods provided for in the items in staging category MX16 shall be maintained at the base rate during year 1 through year 5 and shall be eliminated in 11 annual stages beginning in year 6, and these goods shall be duty-free effective January 1 of year 16;

(o) customs duties on originating goods provided for in the items in staging category MX-R1 shall be reduced by 50 per cent of the base rate in 10 annual stages beginning in year 1, and the customs duty for these goods shall be 10 per cent effective January 1 of year 10 and each subsequent year;

(p) customs duties on originating goods provided for in the items in staging category MX-R2 shall be reduced by 50 per cent of the base rate in five annual stages beginning in year 1, and the customs duty for these goods shall be 36 per cent effective January 1 of year 5 and each subsequent year;

(q) customs duties on originating goods provided for in the items in staging category MX-R3 shall be reduced by 70 per cent of the base rate in seven annual stages beginning in year 1, and the customs duty for these goods shall be 42 per cent effective January 1 of year 7 and each subsequent year;

(r) customs duties on originating goods provided for in the items in staging category MX-R4 shall be reduced as follows:

(i) the customs duty for these goods shall be reduced to 8 per cent in eight annual stages;

(ii) the customs duty for these goods shall be reduced to 7.75 per cent from the level set out in subparagraph (i) effective

January 1 of year 9; and

(iii) the customs duty for these goods shall be reduced to 7.5 per cent from the level set out in subparagraph (ii) effective January 1 of year 10 and each subsequent year;

(s) customs duties on originating goods provided for in the items in staging category MX-R5 shall be reduced as follows:

(i) the customs duty for these goods shall be reduced to 4 per cent in eight annual stages;

(ii) the customs duty for these goods shall be reduced to 3.87 per cent from the level set out in subparagraph (i) effective January 1 of year 9, and

(iii) the customs duty for these goods shall be reduced to 3.75 per cent from the level set out in subparagraph (ii) effective January 1 of year 10 and each subsequent year;

(t) customs duties on originating goods provided for in the items in staging category MX-R6 shall be reduced as follows:

(i) the customs duty for these goods shall be reduced to 1.33 per cent in eight annual stages;

(ii) the customs duty for these goods shall be reduced to 1.28 per cent from the level set out in subparagraph (i) effective

January 1 of year 9, and

(iii) the customs duty for these goods shall be reduced to 1.25 per cent from the level set out in subparagraph (ii) effective January 1 of year 10 and each subsequent year;

(u) customs duties on originating goods provided for in the items in staging category MX-R7 shall be reduced to 47.5 per cent in year 1;

(v) customs duties on originating goods provided for in the items in staging category CSQ shall be governed by the terms of the CSQ for that specific tariff line, as outlined in Appendix A-1 (Tariff Rate Quotas of Mexico) to Mexico's Schedule to Annex 2-D; and

(w) customs duties on originating goods provided for in the items in staging category CSA shall be governed by the terms of the CSA for that specific tariff line, as outlined in Appendix A-2 (Country Specific Allocation for Sugar of Mexico) to Mexico's Schedule to Annex 2-D .

5. The annual stages referred to in paragraph 4 for the elimination or reduction of customs duties shall be equal annual stages, except:

6. Appendix C shall apply when Mexico applies different preferential tariff treatment to other Parties for an originating good specified in Appendix C (Tariff Differentials of Mexico) to this Schedule.


TARIFF SCHEDULE OF MEXICO (HS2012)

APPENDIX A-1

TARIFF RATE QUOTAS OF MEXICO

Section A: General Provisions

1. This Appendix sets out the country-specific tariff rate quotas (TRQs) that Mexico shall apply to certain originating goods of Parties under this Agreement. In particular, originating goods of Parties included under this Appendix shall be subject to the rates of duty set out in this Appendix in lieu of the rates of duty specified in Chapters 1 through 97 of the Mexico's tariff schedule of the General Import and Export Duties Law (Tarifa de la Ley de los Impuestos Generales de Importación y de Exportación – (LIGIE)). Notwithstanding any other provision of the LIGIE, originating goods of Parties to this Agreement in the quantities described in this Appendix shall be permitted entry into the territory of Mexico as provided in this Appendix. Furthermore, except as provided below, any quantity of originating goods imported from a Party under a TRQ provided for in this Appendix shall not be counted toward the in-quota quantity of any TRQ provided for such goods under Mexico's WTO Tariff Schedule or any other trade agreement.

2. Mexico shall administer its TRQs provided for in this Agreement and set out in Section B of this Appendix in accordance with the terms set out in this Appendix and Section D (Tariff Rate Quota Administration) of Chapter 2 (National Treatment and Market Access for Goods).

3. Should Mexico allocate quotas through auctioning, they shall be published online a month in advance, with no restrictions on participation or bid volumes, and all winning bidders shall pay the price of the lowest winning bid. Within two weeks of the auction, the names of winning bidders and prices and quantities of winning bids shall be published online.

4. For quotas administered on a first come, first served basis, Mexico may require importers to obtain an import licence from the Secretaría de Economía for each shipment. Such licences will be issued forthwith without any conditions, on presentation of a proof of purchase of goods covered by quotas listed below, provided quota volumes remain available. Mexico may consider the discontinuation of the import licence as improvements in customs operations permit.

5. The product or products covered by each TRQ set out in Section B are informally identified in the title to the paragraph setting out the TRQ. These titles are included solely to assist readers in understanding this Appendix and shall not alter or supersede the coverage established through identification of covered codes of Mexico's LIGIE.

6. Each TRQ set out in this Appendix shall apply to an aggregate quantity of originating goods of the Parties identified in the first subparagraph of the paragraph setting out the TRQ.

7. For the purposes of this Appendix, the term "metric tonnes" shall be abbreviated as "MT".

Section B: Country Specific TRQs (CSQ)

8. CSQ-MX1: Milk and Cream, not Concentrated or Containing Added Sugar or Other Sweetening Matter.

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Australia, Brunei, Canada, Japan, Malaysia, New Zealand, Singapore and Vietnam identified in subparagraph (e). The CSQ set out in this paragraph is designated in the Tariff Schedule of Mexico to Annex 2-D (Tariff Commitments) with the designation "CSQ-MX1".

(b) The aggregate quantity of originating goods of Australia, Brunei, Canada, Japan, Malaysia, New Zealand, Singapore and Vietnam described in subparagraph (e) that shall be permitted to enter duty free in each year under this CSQ is:

Starting in year 11, the quantity shall remain at 375,000 Litres per year.

(c) Goods entered in aggregate quantities in excess of the quantities set out in subparagraph (b) shall continue to receive the rate of customs duty applied under the WTO Agreement.

(d) Mexico may allocate this CSQ through auctioning for no more than five years after the date of entry into force of this Agreement for Mexico. Starting in year 6, this CSQ shall be administered on a first come, first served basis.

(e) Subparagraphs (a) through (d) apply to the following heading: 04.01.

9. CSQ-MX2: Milk Powder

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Australia, Brunei, Canada, Japan, Malaysia, New Zealand, Singapore and Vietnam identified in subparagraph (e). The CSQ set out in this paragraph is designated in the Tariff Schedule of Mexico to Annex 2-D (Tariff Commitments) with the designation "CSQ-MX2".

(b) The aggregate quantity of originating goods of Australia, Brunei, Canada, Japan, Malaysia, New Zealand, Singapore and Vietnam described in subparagraph (e) that shall be permitted to enter duty free in each year under this CSQ is:

Starting in year 11, the quantity shall remain at 42,000 MT per year.

(c) Goods entered in aggregate quantities in excess of the quantities set out in subparagraph (b) shall continue to receive the rate of customs duty applied under the WTO Agreement.

(d) Mexico shall apply the following provisions in the administration of this CSQ:

(i) From year 1 to year 10, at least 80 per cent of the CSQ quantities set out in subparagraph (b) shall be allocated to tariff item 0402.21.01.

(ii) Mexico may allocate this CSQ through auctioning for no more than three years after the date of entry into force of this Agreement for Mexico. Starting in year 4, this CSQ shall be administered on a first come, first served basis.

(e) Subparagraphs (a) through (d) apply to the following tariff items: 0402.10.01 and 0402.21.01.

10. CSQ-MX3: Evaporated Milk

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Australia, Brunei, Canada, Japan, Malaysia, New Zealand, Singapore and Vietnam identified in subparagraph (e). The CSQ set out in this paragraph is designated in the Tariff Schedule of Mexico to Annex 2-D (Tariff Commitments) with the designation "CSQ-MX3".

(b) The aggregate quantity of originating goods of Australia, Brunei, Canada, Japan, Malaysia, New Zealand, Singapore and Vietnam described in subparagraph (e) that shall be permitted to enter duty free in each year under this CSQ is:

Starting in year 11, the quantity shall remain at 750 MT per year.

(c) Goods entered in aggregate quantities in excess of the quantities set out in subparagraph (b) shall continue to receive the rate of customs duty applied under the WTO Agreement.

(d) Mexico may allocate this CSQ through auctioning.

(e) Subparagraphs (a) through (d) apply to the following tariff items: 0402.91.01 and 0402.91.99.

11. CSQ-MX4: Condensed Milk

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Australia, Brunei, Canada, Japan, Malaysia, New Zealand, Singapore and Vietnam identified in subparagraph (e). The CSQ set out in this paragraph is designated in the Tariff Schedule of Mexico to Annex 2-D (Tariff Commitments) with the designation "CSQ-MX4".

(b) The aggregate quantity of originating goods of Australia, Brunei, Canada, Japan, Malaysia, New Zealand, Singapore and Vietnam described in subparagraph (e) that shall be permitted to enter duty free in each year under this CSQ is:

Starting in year 11, the quantity shall remain at 1,500 MT per year.

(c) Goods entered in aggregate quantities in excess of the quantities set out in subparagraph (b) shall continue to receive the rate of customs duty applied under the WTO Agreement.

(d) Mexico may allocate this CSQ through auctioning

(e) Subparagraphs (a) through (d) apply to the following tariff items: 0402.99.01 and 0402.99.99.

12. CSQ-MX5: Products Consisting of Natural Milk Constituents, Whether or not Containing Added Sugar or Other Sweetening Matter, not Elsewhere Specified or Included

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Australia, Brunei, Canada, Malaysia, New Zealand, Singapore and Vietnam identified in subparagraph (e). The CSQ set out in this paragraph is designated in the Tariff Schedule of Mexico to Annex 2-D (Tariff Commitments) with the designation "CSQ-MX5".

(b) The aggregate quantity of originating goods of Australia, Brunei, Canada, Malaysia, New Zealand, Singapore and Vietnam described in subparagraph (e) that shall be permitted to enter duty-free in each year under this CSQ is:

Starting in year 11, the quantity shall remain at 2,000 MT per year.

(c) Goods entered in aggregate quantities in excess of the quantities set out in subparagraph (b) shall continue to receive the rate of customs duty applied under the WTO Agreement.

(d) Mexico may allocate this CSQ through auctioning for no more than five years after entry into force of this Agreement for Mexico. Starting in year 6, this CSQ shall be administered on a first come, first served basis.

(e) Subparagraphs (a) through (d) apply to the following tariff item: 0404.90.99.

13. CSQ-MX6: Butter

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Australia, Brunei, Canada, Japan, Malaysia, New Zealand, Singapore and Vietnam identified in subparagraph (e). The CSQ set out in this paragraph is designated in the Tariff Schedule of Mexico to Annex 2-D (Tariff Commitments) with the designation "CSQ-MX6".

(b) The aggregate quantity of originating goods of Australia, Brunei, Canada, Japan, Malaysia, New Zealand, Singapore and Vietnam described in subparagraph (e) that shall be permitted to enter duty free in each year under this CSQ is:

Starting in year 11, the quantity shall remain at 2,000 MT per year.

(c) Goods entered in aggregate quantities in excess of the quantities set out in subparagraph (b) shall continue to receive the rate of customs duty applied under the WTO Agreement.

(d) Mexico may allocate this CSQ through auctioning for no more than three years after the date of entry into force of this Agreement for Mexico. Starting in year 4, this CSQ shall be administered on a first come, first served basis.

(e) Subparagraphs (a) through (d) apply to subheadings: 0405.10 and 0405.20.

14. CSQ-MX7: Cheese

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Australia, Brunei, Canada, Japan, Malaysia, New Zealand, Singapore and Vietnam identified in subparagraph (e). The CSQ set out in this paragraph is designated in the Tariff Schedule of Mexico to Annex 2-D (Tariff Commitments) with the designation "CSQ-MX7".

(b) The aggregate quantity of originating goods of Australia, Brunei, Canada, Japan, Malaysia, New Zealand, Singapore and Vietnam described in subparagraph (e) that shall be permitted to enter duty free in each year under this CSQ is:

Starting in year 11, the quantity shall remain at 6,500 MT per year.

(c) Goods entered in aggregate quantities in excess of the quantities set out in subparagraph (b) shall continue to receive the rate of customs duty applied under the WTO Agreement.

(d) Mexico may allocate this CSQ through auctioning for no more than three years after the date of entry into force of this Agreement for Mexico. Starting in year 4, this CSQ shall be administered on a first come, first served basis.

(e) Subparagraphs (a) through (d) apply to the following tariff items: 0406.10.01; 0406.20.01; 0406.30.01; 0406.30.99; 0406.90.03; 0406.90.04; 0406.90.05; 0406.90.06 and 0406.90.99.

15. CSQ-MX8: Dairy-Based Preparations

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Australia, Brunei, Canada, Japan, Malaysia, New Zealand, Singapore and Vietnam identified in subparagraph (e). The CSQ set out in this paragraph is designated in the Tariff Schedule of Mexico to Annex 2-D (Tariff Commitments) with the designation "CSQ-MX8".

(b) The aggregate quantity of originating goods of Australia, Brunei, Canada, Japan, Malaysia, New Zealand, Singapore and Vietnam described in subparagraph (e) that shall be permitted to enter duty free in each year under this CSQ is:

Starting in year 11, the quantity shall remain at 2,500 MT per year.

(c) Goods entered in aggregate quantities in excess of the quantities set out in subparagraph (b) shall continue to receive the rate of customs duty applied under the WTO Agreement.

(d) Mexico may allocate this CSQ through auctioning for no more than five years after the date of entry into force of this Agreement for Mexico. Starting in year 6, this CSQ shall be administered on a first come, first served basis.

(e) Subparagraphs (a) through (d) apply to the following tariff items: 1901.90.04 and 1901.90.05.

16. CSQ-MX9: Palm Oil and Palm Kernel Oil

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Malaysia identified in subparagraph (e). The CSQ set out in this paragraph is designated in the Tariff Schedule of Mexico to Annex 2-D (Tariff Commitments) with the designation "CSQ-MX9".

(b) The aggregate quantity of originating goods of Malaysia described in subparagraph (e) that shall be permitted to enter duty-free in each year under this CSQ is:

Starting in year 3, the quantity shall remain at 12,000 MT per year.

(c) Goods entered in aggregate quantities in excess of the quantities set out in subparagraph (b) shall continue to receive the rate of customs duty applied under the WTO Agreement.

(d) Mexico may allocate through auctioning.

(e) Subparagraphs (a) through (d) apply to the following tariff items: 1511.10.01; 1511.90.99 and 1513.29.99.


APPENDIX A-2

COUNTRY SPECIFIC ALLOCATION FOR SUGAR OF MEXICO

1. CSA-MX: Country Specific Allocation for Sugar

(a) Mexico shall grant tariff concessions for sugar under this Agreement only when it requires to import sugar to address its domestic demand through unilateral MFN tariff rate quotas (TRQs). Otherwise, all sugar imports into Mexico under this Agreement shall be subject to the rate of customs duty applied under the WTO Agreement.

(b) The Country Specific Allocation (CSA) set out in this Appendix is designated in the Tariff Schedule of Mexico to Annex 2-D (Tariff Commitments) as "CSA-MX".

(c) Mexico shall grant to Australia 7 per cent of any unilateral MFN TRQ Mexico may open, subject to the following conditions:

(i) The CSA allocated to Australia shall be imported duty free.

(ii) Mexico shall allocate this CSA to Australia through auctioning in accordance with Mexico's internal legal procedures.

(iii) Australia shall notify Mexico if it cannot fulfill the CSA, so that Mexico can reallocate it to other countries.

(iv) Australia may export to Mexico under the unilateral MFN TRQ during the two months following the date on which the respective certificates are issued. Nevertheless, in cases where the validity of the unilateral sugar TRQ under an MFN basis exceeds four months, Australia shall have three months to export to Mexico from the date that quota certificate is issued.

(v) To be eligible for the tariff preference established in subparagraph (i), the sugar from Australia shall comply with the applicable product specific rule of origin set out in Annex 3-D (Product-Specific Rules of Origin).

(vi) Any amount of CSA not used by Australia shall not be accumulated for subsequent periods.

(vii) For the amount that exceeds the quantity of the CSA allocated to Australia, the conditions established for the unilateral MFN TRQ shall apply, without prejudice to the rights and obligations of this country under the WTO.

(viii) For the purposes of this CSA, the scope of "sugar" covers those goods classified under heading 17.01, and tariff items 1702.90.01, 1806.10.01 and 2106.90.05. Mexico shall indicate in its official gazette, as appropriate, the specific tariff items subject to the CSA.


New Zealand

ANNEX 2-D

TARIFF SCHEDULE OF NEW ZEALAND GENERAL NOTES

1. The provisions of this Schedule are generally expressed in terms of the Working Tariff Document of New Zealand, and the interpretation of the provisions of this Schedule, including the product coverage of subheadings of this Schedule, shall be governed by the General Notes, Section Notes and Chapter Notes of the Working Tariff Document of New Zealand. To the extent that provisions of this Schedule are identical to the corresponding provisions of the Working Tariff Document of New Zealand, the provisions of this Schedule shall have the same meaning as the corresponding provisions of the Working Tariff Document of New Zealand.

2. The base rates of duty set out in this Schedule reflect New Zealand's Most-Favoured-Nation (MFN) rates of duty in effect on January 1, 2010.

3. In this Schedule, rates of duty expressed in monetary units shall be rounded to the nearest hundredth of a New Zealand dollar.

4. The following staging categories shall apply to the elimination of customs duties by New Zealand pursuant to Article 2.4.2 (Elimination of Customs Duties):

(a) customs duties on originating goods provided for in the items in staging category EIF shall be eliminated entirely, and these goods shall be duty-free on the date of entry into force of this Agreement for New Zealand;

(b) customs duties on originating goods provided for in the items in staging category B2 shall be eliminated in two annual stages, and these goods shall be duty-free from January 1 of year 2;

(c) customs duties on originating goods provided for in the items in staging category B5 shall be eliminated in five annual stages, and these goods shall be duty-free from January 1 of year 5;

(d) customs duties on originating goods provided for in the items in staging category B7 shall be eliminated in seven annual stages, and these goods shall be duty-free from January 1 of year 7; and

(e) originating goods provided for in the items in staging category NZ Parts shall receive the same tariff treatment as goods provided for in the corresponding non-parts tariff items.

5. The annual stages referred to in paragraph 4 for the elimination of customs duties shall be equal, annual stages, except:

(a) as provided in paragraphs 3(b)(i), 4(a)(ii) and 4(b)(ii) in Section A of this Annex; or

(b) as otherwise provided in paragraph 4.

6. (a) Upon request from Japan, New Zealand and Japan shall consult to consider New Zealand's commitments to Japan regarding treatment of originating goods related to the application of customs duties, tariff rate quotas and safeguards in this Schedule no sooner than seven years after the date of entry into force of this Agreement for New Zealand and Japan, with a view to increasing market access.

(b) Following completion of applicable legal procedures by New Zealand and another State or customs territory necessary for entry into force of an international agreement, or an amendment thereto, granting preferential market access by New Zealand to that other State or customs territory, and on request of Japan, New Zealand and Japan shall consult to consider New Zealand's commitments to Japan regarding treatment of originating goods related to the application of customs duties, tariff rate quotas and safeguards in this Schedule, with a view to providing to the originating goods treatment equivalent to that provided to goods classified in the same tariff lines under the international agreement. New Zealand and Japan shall consult no later than one month after the date of the request, unless New Zealand and Japan agree otherwise.

(c) For greater certainty, nothing in this paragraph shall be construed to affect the rights or obligations of New Zealand under any other provision of this Agreement.

TARIFF SCHEDULE OF NEW ZEALAND (HS 2012)

ANNEX 2-D

TARIFF SCHEDULE OF PERU GENERAL NOTES

1. The provisions of this Schedule are generally expressed in terms of the Customs Tariff Schedule of Peru (Arancel de Aduanas de la República del Perú (AAPERU)), and the interpretation of the provisions of this Schedule, including the product coverage of subheadings of this Schedule, shall be governed by the General Notes, Section Notes and Chapter Notes of the AAPERU. To the extent that provisions of this Schedule are identical to the corresponding provisions of the AAPERU, the provisions of this Schedule shall have the same meaning as the corresponding provisions of the AAPERU.

2. The base rates of duty set out in this Schedule reflect Peru's Most Favoured-Nation (MFN) rates of duty in effect on January 1, 2010.

3. In this Schedule, rates of duty expressed in monetary units shall be rounded down to the nearest 0.001 of the official monetary unit of Peru.

4. The following staging categories shall apply to the elimination of customs duties by Peru pursuant to Article 2.4.2 (Elimination of Customs Duties):

(a) customs duties on originating goods provided for in the items in staging category EIF shall be eliminated entirely, and these goods shall be duty-free on the date of entry into force of this Agreement for Peru;

(b) customs duties on originating goods provided for in the items in staging category B6 shall be eliminated in six annual stages, and these goods shall be duty-free effective January 1 of year 6;

(c) customs duties on originating goods provided for in the items in staging category B11 shall be eliminated in 11 annual stages, and these goods shall be duty-free effective January 1 of year 11;

(d) customs duties on originating goods provided for in the items in staging category B13 shall be eliminated in 13 annual stages, and these goods shall be duty-free effective January 1 of year 13;

(e) customs duties on originating goods provided for in the items in staging category B16 shall be eliminated in 16 annual stages, and these goods shall be duty-free effective January 1 of year 16;

(f) customs duties on originating goods provided for in the items in staging category PE-R1 shall be reduced as follows:

(i) the ad valorem duty shall be eliminated entirely on the date of entry into force of this Agreement for Peru; and

(ii) the specific duty derived from the application of the Peruvian Price Band System established in the D.S. N° 115-2001-EF and its amendments, any future modification or any succeeding system shall be excluded from any tariff elimination; and

(g) customs duties on originating goods provided for in the items in staging category PE-R2 shall be reduced as follows:

(i) the ad valorem duty shall be eliminated in six annual stages, and these goods shall be ad valorem duty-free effective January 1 of year 6; and

(ii) the specific duty derived from the application of the Peruvian Price Band System established in the D.S. N° 115-2001-EF and its amendments, any future modification or any succeeding system shall be excluded from any tariff elimination.

5. The annual stages referred to in paragraph 4 for the elimination of customs duties shall be equal, annual stages, except:

(a) as provided in paragraphs 3(b)(i), 4(a)(ii) and 4(b)(ii) in Section A of this Annex; or

(b) as otherwise provided in paragraph 4.


TARIFF SCHEDULE OF PERU (HS2012)

Singapore

ANNEX 2-D

TARIFF SCHEDULE OF SINGAPORE GENERAL NOTES

1. The provisions of this Schedule are generally expressed in terms of the Singapore Trade Classification, Customs and Excise Duties (STCCED), and the interpretation of the provisions of this Schedule, including the product coverage of subheadings of this Schedule, shall be governed by the General Notes, Section Notes and Chapter Notes of the STCCED. To the extent that provisions of this Schedule are identical to the corresponding provisions of the STCCED, the provisions of this Schedule shall have the same meaning as the corresponding provisions of the STCCED.

2. The base rates of duty set out in this Schedule reflect Singapore's MostFavoured-Nation (MFN) rates of duty in effect on January 1, 2010.

3. Pursuant to Article 2.4.2 (Elimination of Customs Duty), customs duties on originating goods provided for in the items in staging category EIF shall be eliminated entirely, and these goods shall be duty-free on the date of entry into force of this Agreement for Singapore.


TARIFF SCHEDULE OF SINGAPORE (HS2012)


United States

ANNEX 2-D

TARIFF SCHEDULE OF THE UNITED STATES GENERAL NOTES

1. The provisions of this Schedule are generally expressed in terms of the Harmonized Tariff Schedule of the United States (HTSUS), and the interpretation of the provisions of this Schedule, including the product coverage of subheadings of this Schedule, shall be governed by the General Notes, Section Notes and Chapter Notes of the HTSUS. To the extent that provisions of this Schedule are identical to the corresponding provisions of the HTSUS, the provisions of this Schedule shall have the same meaning as the corresponding provisions of the HTSUS.

2. Except as otherwise provided in this Schedule, the base rates of duty set out in this Schedule reflect the United States' Most-Favoured-Nation (MFN) rates of duty in effect on January 1, 2010. For items identified with an asterisk (*), the applicable base rates of duty are those set forth in this Schedule.

3. In this Schedule, rates of duty expressed in monetary units shall be rounded down to the nearest tenth of one U.S. cent.

4. The following staging categories shall apply to the elimination or reduction of customs duties by the United States pursuant to Article 2.4.2 (Elimination of Customs Duties):

(a) customs duties on originating goods provided for in the items in staging category EIF shall be eliminated entirely, and these goods shall be duty-free on the date of entry into force of this Agreement for the United States;

(b) customs duties on originating goods provided for in the items in staging category B3 shall be eliminated in three annual stages, and these goods shall be duty-free effective January 1 of year 3;

(c) customs duties on originating goods provided for in the items in staging category B4 shall be eliminated in four annual stages, and these goods shall be duty-free effective January 1 of year 4;

(d) customs duties on originating goods provided for in the items in staging category B5 shall be eliminated in five annual stages, and these goods shall be duty-free effective January 1 of year 5;

(e) customs duties on originating goods provided for in the items in staging category B6 shall be eliminated in six annual stages, and these goods shall be duty-free effective January 1 of year 6;

(f) customs duties on originating goods provided for in the items in staging category B7 shall be eliminated in seven annual stages, and these goods shall be duty-free effective January 1 of year 7;

(g) customs duties on originating goods provided for in the items in staging category B8 shall be eliminated in eight annual stages, and these goods shall be duty-free effective January 1 of year 8;

(h) customs duties on originating goods provided for in the items in staging category B10 shall be eliminated in 10 annual stages, and these goods shall be duty-free effective January 1 of year 10;

(i) customs duties on originating goods provided for in the items in staging category B11 shall be eliminated in 11 annual stages, and these goods shall be duty-free effective January 1 of year 11;

(j) customs duties on originating goods provided for in the items in staging category B12 shall be eliminated in 12 annual stages, and these goods shall be duty-free effective January 1 of year 12;

(k) customs duties on originating goods provided for in the items in staging category B15 shall be eliminated in 15 annual stages, and these goods shall be duty-free effective January 1 of year 15;

(l) customs duties on originating goods provided for in the items in staging category B16 shall be eliminated in 16 annual stages, and these goods shall be duty-free effective January 1 of year 16;

(m) customs duties on originating goods provided for in the items in staging category B20 shall be eliminated in 20 annual stages, and these goods shall be duty-free effective January 1 of year 20;

(n) customs duties on originating goods provided for in the items in staging category US1 shall be reduced by 40 per cent of the base rate on the date of entry into force of this Agreement for the United States and shall remain at the resulting rates until December 31 of year 3. On January 1 of year 4, these duties shall be reduced by an additional five per cent of the base rate. On January 1 of year 5, these duties shall be reduced by an additional five per cent of the base rate, and they shall remain at the resulting rates until December 31 of year 11. These goods shall be duty-free effective January 1 of year 12;

(o) customs duties on originating goods provided for in the items in staging category US2 shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement for the United States and shall remain at the resulting rates until December 31 of year 11. These goods shall be duty-free effective January 1 of year 12;

(p) customs duties on originating goods provided for in the items in staging category US3 shall be reduced by 55 per cent of the base rate on the date of entry into force of this Agreement for the United States and shall remain at the resulting rates until December 31 of year 11. These goods shall be duty-free effective January 1 of year 12;

(q) customs duties on originating goods provided for in the items in staging category US4 shall remain at base rates until December 31 of year 8. Beginning on January 1 of year 9, these duties shall be eliminated in four annual stages. These goods shall be duty-free effective January 1 of year 12;

(r) customs duties on originating goods provided for in the items in staging category US5 shall remain at base rates until December 31 of year 4. These goods shall be duty-free effective January 1 of year 5;

(s) customs duties on originating goods provided for in the items in staging category US6 shall be reduced by 35 per cent of the base rate on the date of entry into force of this Agreement for the United States and shall remain at the resulting rates until December 31 of year 10. These goods shall be duty-free effective January 1 of year 11;

(t) customs duties on originating goods provided for in the items in staging category US7 shall be reduced by 35 per cent of the base rate on the date of entry into force of this Agreement for the United States and shall remain at the resulting rates until December 31 of year 12. These goods shall be duty-free effective January 1 of year 13;

(u) customs duties on originating goods provided for in the items in staging category US8 shall be reduced by 35 per cent of the base rate on the date of entry into force of this Agreement for the United States and shall remain at the resulting rates until December 31 of year 5. On January 1 of year 6, these duties shall be reduced by an additional 15 per cent of the base rate, and they shall remain at the resulting rates until December 31 of year 10. These goods shall be duty-free effective January 1 of year 11;

(v) customs duties on originating goods provided for in the items in staging category US9 shall be reduced by 35 per cent of the base rate on the date of entry into force of this Agreement for the United States and shall remain at the resulting rates until December 31 of year 6. On January 1 of year 7, these duties shall be reduced by an additional 15 per cent of the base rate, and they shall remain at the resulting rates until December 31 of year 12. These goods shall be duty-free effective January 1 of year 13;

(w) customs duties on originating goods provided for in the items in staging category US10 shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement for the United States and shall remain at the resulting rates until December 31 of year 10. These goods shall be duty-free effective January 1 of year 11;

(x) customs duties on originating goods provided for in the items in staging category US11 shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement for the United States and shall remain at the resulting rates until December 31 of year 12. These goods shall be duty-free effective January 1 of year 13;

(y) customs duties on originating goods provided for in the items in staging category US12 shall be reduced to five per cent ad valorem on the date of entry into force of this Agreement for the United States and shall remain at that rate until December 31 of year 3. On January 1 of year 4, these duties shall be reduced to four per cent ad valorem, and they shall remain at that rate until December 31 of year 6. On January 1 of year 7, these duties shall be reduced to three per cent ad valorem, and they shall remain at that rate until December 31 of year 8. On January 1 of year 9, these duties shall be reduced to two per cent ad valorem, and they shall remain at that rate until December 31 of year 10. On January 1 of year 11, these duties shall be reduced to 0.5 per cent ad valorem, and they shall remain at that rate until December 31 of year 11. These goods shall be duty-free effective January 1 of year 12;

(z) customs duties on originating goods provided for in the items in staging category US13 shall remain at base rates until December 31 of 2021. These goods shall be duty-free effective January 1 of 2022;

(aa) customs duties on originating goods provided for in the items in staging category US14 shall remain at base rates until December 31 of year 6. These goods shall be duty-free effective January 1 of year 7;

(bb) customs duties on originating goods provided for in the items in staging category US15 shall remain at base rates until December 31 of year 14. On January 1 of year 15, these duties shall be reduced to 2.25 per cent ad valorem, and they shall remain at that rate until December 31 of year 19. On January 1 of year 20, these duties shall be reduced to 1.25 per cent ad valorem, and they shall remain at that rate until December 31 of year 21. On January 1 of year 22, these duties shall be reduced to 0.5 per cent ad valorem, and they shall remain at that rate until December 31 of year 24. These goods shall be duty-free effective January 1 of year 25;

(cc) customs duties on originating goods provided for in the items in staging category US16 shall remain at base rates until December 31 of year 14. On January 1 of year 15, these duties shall be reduced to 3.6 per cent ad valorem, and they shall remain at that rate until December 31 of year 19. On January 1 of year 20, these duties shall be reduced to 2.0 per cent ad valorem, and they shall remain at that rate until December 31 of year 21. On January 1 of year 22, these duties shall be reduced to 0.8 per cent ad valorem, and they shall remain at that rate until December 31 of year 24. These goods shall be duty-free effective January 1 of year 25;

(dd) customs duties on originating goods provided for in the items in staging category US17 shall remain at base rates until December 31 of year 29. These goods shall be duty-free effective January 1 of year 30;

(ee) customs duties on originating goods provided for in the items in staging category US18 shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement for the United States. Beginning on January 1 of year 2, the resulting duties shall be eliminated in 14 annual stages, and these goods shall be duty free effective January 1 of year 15;

(ff) customs duties on originating goods provided for in the items in staging category US19 shall be reduced by 20 per cent of the base rate on the date of entry into force of this Agreement for the United States. Beginning on January 1 of year 2, the resulting duties shall be eliminated in 19 annual stages, and these goods shall be duty free effective January 1 of year 20;

(gg) customs duties on originating goods provided for in the items in staging category US20 shall be no higher than the rate applicable under the staging category set out for that item in the Schedule of the United States to Annex 2-B of the United States – Australia Free Trade Agreement, done at Washington, District of Columbia, May 18, 2004;

(hh) customs duties on originating goods provided for in the items in staging category US21 shall be no higher than the rate applicable under the staging category set out for that item in the Schedule of the United States to Annex 2.3 of the United States – Peru Trade Promotion Agreement, done at Washington, District of Columbia, April 12, 2006;

(ii) customs duties on originating goods provided for in the items in staging category US22 shall be reduced by 50 per cent of the base rate on the date of entry into force of this Agreement for the United States. Beginning on January 1 of year 2, the resulting duties shall be eliminated in nine annual stages, and these goods shall be duty free effective January 1 of year 10;

(jj) customs duties on originating goods provided for in the items in staging category US23 shall be reduced by 33 per cent of the base rate on the date of entry into force of this Agreement for the United States. Beginning on January 1 of year 2, the resulting duties shall be eliminated in 19 annual stages, and these goods shall be duty free effective January 1 of year 20;

(kk) customs duties on originating goods provided for in the items in staging category US24 shall be reduced by 20 per cent of the base rate on the date of entry into force of this Agreement for the United States. Beginning on January 1 of year 2, the resulting duties shall be eliminated in 29 annual stages, and these goods shall be duty free effective January 1 of year 30;

(ll) customs duties on originating goods provided for in the items in staging category US25 shall be eliminated entirely and these goods shall be duty-free on the date of entry into force of this Agreement for the United States. For goods in tariff items 9812.00.20, 9812.00.40, 9813.00.05, 9813.00.10, 9813.00.15, 9813.00.20, 9813.00.25, 9813.00.30, 9813.00.35, 9813.00.40, 9813.00.45, 9813.00.50, 9813.00.55, 9813.00.60, 9813.00.70, 9813.00.75 and 9814.00.50, duty-free means free without bond; and

(mm) customs duties on originating goods provided for in the items in staging category TRQ shall be governed by the terms of the TRQ applicable to that tariff item, as outlined in Appendix A (Tariff Rate Quotas of the United States) to this Schedule of the United States to Annex 2-D.

5. Originating goods provided for in the items marked with the designation SG-US[x] in this Schedule shall be subject to the corresponding country-specific safeguard measure set forth in Appendix B (Agricultural Safeguard Measures of the United States) to this Schedule.

6. Appendix C shall apply when the United States applies different preferential tariff treatment to other Parties for an originating good specified in Appendix C (Tariff Differentials of the United States) to this Schedule.

7. The annual stages referred to in paragraph 4 for the elimination or reduction of customs duties shall be equal, annual stages, except:

(a) as provided in paragraphs 3(b)(i), 4(a)(ii) and 4(b)(ii) in Section A of this Annex; or

(b) as otherwise provided in paragraph 4.

8. The staging of tariff elimination and reduction provided for in this Schedule with respect to originating goods of Japan is premised on entry into force of the Agreement for both Japan and the United States between January 1 and March 31 of a given year. If the Agreement will enter into force between April 1 and December 31 of a given year, the United States will consult with Japan regarding the implementation of the staging categories in this Schedule.

9. (a) Upon request from Japan, the United States and Japan shall consult to consider the commitments of the United States to Japan regarding treatment of originating goods related to the application of customs duties, tariff rate quotas and safeguards in this Schedule no sooner than seven years after the date of entry into force of this Agreement for the United States and Japan, with a view to increasing market access.

(b) Following completion of applicable legal procedures by the United States and another State or customs territory necessary for entry into force of an international agreement, or an amendment thereto, granting preferential market access by the United States to that other State or customs territory, if requested by Japan, the United States and Japan shall consult to consider the commitments of the United States to Japan regarding treatment of originating goods related to the application of customs duties, tariff rate quotas and safeguards in this Schedule, with a view to providing to the originating goods treatment equivalent to that provided to goods classified in the same tariff lines under the international agreement. The United States and Japan shall consult no later than one month after the date of the request, unless the United States and Japan agree otherwise.

(c) For greater certainty, nothing in this paragraph shall be construed to affect the rights or obligations of the United States under any other provision of this Agreement.


TARIFF SCHEDULE OF THE UNITED STATES (HS 2012)

APPENDIX A

TARIFF RATE QUOTAS OF THE UNITED STATES

1. This Appendix sets out modifications to the Harmonized Tariff Schedule of the United States (HTSUS) that reflect the tariff rate quotas (TRQs) that the United States shall apply to certain originating goods under this Agreement. In particular, originating goods of Parties included under this Appendix shall be subject to the rates of duty set out in this Appendix in lieu of the rates of duty specified in Chapters 1 through 97 of the HTSUS. Notwithstanding any other provision of the HTSUS, originating goods of Parties in the quantities described in this Appendix shall be permitted entry into the territory of the United States as provided in this Appendix. Furthermore, except as provided below, any quantity of originating goods imported from a Party under a TRQ provided for in this Appendix shall not be counted toward the in-quota quantity of any TRQ provided for such goods under the United States' WTO tariff Schedule or any other trade agreement.

2. Except as provided below, the United States shall administer all TRQs provided for in this Agreement and set out in this Appendix on a first-come, first served basis.

3. The product or products covered by each TRQ set out below are informally described in the title to the paragraph setting out the TRQ. These titles are included solely to assist readers in understanding this Appendix and shall not alter or supersede the coverage for each TRQ established by reference to the relevant Table 1 provisions. For the purposes of this Appendix, the term "metric tonnes" shall be abbreviated as "MT".

4. Each TRQ set out in this Appendix shall apply to an aggregate quantity of originating goods of the Party identified in the first subparagraph of the paragraph setting out the TRQ. For the purposes of this Appendix, an originating good shall, except as otherwise specified in the paragraph setting out a TRQ, be deemed to be of the Party identified in the first subparagraph of the paragraph setting out the TRQ if the United States would apply for that good the rate of customs duty for the originating good of that Party pursuant to:

(a) paragraph 8 in Section B (Tariff Differentials) of Annex 2-D (Tariff Commitments), if the relevant tariff item is not listed in Appendix C (Tariff Differentials) to the Schedule of the United States to Annex 2-D (Tariff Commitments); or

(b) paragraph 1 or paragraph 2(a), as applicable, of Appendix C (Tariff Differentials) to the Schedule of the United States to Annex 2-D (Tariff Commitments), if the relevant tariff item is listed in that Appendix.

5. CSQ-US1: Raw Sugar – Country-Specific Tariff-Rate Quota for Australia

(a) This paragraph sets out a country-specific TRQ for the originating goods of Australia described in subparagraph (e). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ US1".

(b) Except as provided in subparagraph (c), the aggregate quantity of originating goods of Australia described in subparagraph (e) that shall be permitted to enter free of duty in each year is 60,500 MT. This quantity shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of Australia is in effect for the goods.

(c) In any year in which the United States Secretary of Agriculture (the Secretary) makes a determination to permit the importation into the United States at in-quota tariff rates of additional quantities of raw sugar above the quantities made available at those rates pursuant to its commitments under the WTO Agreement and other trade agreements, including this Agreement, ("additional in-quota rate imports of raw sugar"), the quantity set out for that year in subparagraph (b) shall be increased by an amount equal to 14.7 per cent of the quantity of additional in-quota rate imports of raw sugar that the Secretary determines to permit to enter into the United States in that year. Any increase pursuant to this subparagraph of a quantity set out in subparagraph (b) shall not take effect until the date on which the additional in-quota rate imports of raw sugar are permitted entry into the United States. Nothing in this paragraph shall alter Australia's rights under the WTO Agreement with respect to any increase by the United States of the quantities of raw sugar permitted to be imported above the quantities made available at in-quota tariff rates pursuant to its commitments under the WTO Agreement and other trade agreements, including this Agreement.

(d) Goods entered in aggregate quantities in excess of the quantities provided under subparagraphs (b) and (c) shall continue to receive MFN tariff treatment.

(e) Subparagraphs (a) through (d) apply to the following Table 1 provisions: AG17011250, AG17011350 and AG17011450.

6. CSQ-US2: Sugar and Sugar-Containing Products – Country-Specific Tariff-Rate Quota for Australia

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Australia described in subparagraph (d). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US2".

(b) The aggregate quantity of originating goods of Australia described in subparagraph (d) that shall be permitted to enter free of duty in each year is 4,500 MT.

The above quantity shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of Australia is in effect for the goods.

(c) Goods entered in aggregate quantities in excess of the quantity listed in subparagraph (b) shall continue to receive MFN tariff treatment.

(d) Subparagraphs (a) through (c) apply to the following Table 1 provisions: AG17011250, AG17011350, AG17011450, AG17019130, AG17019148, AG17019158, AG17019950, AG17022028, AG17023028, AG17024028, AG17026028, AG17029020, AG17029058, AG17029068, AG17049068, AG17049078, AG18061015, AG18061028, AG18061038, AG18061055, AG18061075, AG18062073, AG18062077, AG18062094, AG18062098, AG18069039, AG18069049, AG18069059, AG19012025, AG19012035, AG19012060, AG19012070, AG19019054, AG19019058, AG21011238, AG21011248, AG21011258, AG21012038, AG21012048, AG21012058, AG21039078, AG21069046, AG21069072, AG21069076, AG21069080, AG21069091, AG21069094 and AG21069097.

7. CSQ-US3: Creams and Ice Cream – Country-Specific Tariff-Rate Quota for Australia

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Australia described in subparagraph (f). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US3".

(b) In the year of entry into force of this Agreement as between the United States and Australia, the aggregate quantity of originating goods of Australia described in subparagraph (f) that shall be permitted to enter free of duty shall be equal to the volume permitted duty-free entry for that year under paragraph (4) of Annex I to the General Notes to the Tariff Schedule of the United States in Annex 2-B to the United States-Australia Free Trade Agreement, reduced by 3,880,500 litres.

In each year thereafter, the quantity shall increase at a compounded annual growth rate of six per cent.

The above quantities shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of Australia is in effect for the goods.

(c) In the year of entry into force of this Agreement as between the United States and Australia, the in-quota quantity set out in subparagraph (b) for that year shall be reduced by the in-quota amount imported during the year under paragraph (4) of Annex I to the General Notes to the Tariff Schedule of the United States in Annex 2-B to the United States-Australia Free Trade Agreement.

(d) With respect to goods described in subparagraph (f) entered in aggregate quantities in excess of the quantities provided under subparagraphs (b) and (c):

(i) for those goods provided for in Table 1 provision AG21050020, duties shall be removed in accordance with the provisions of staging category US18 in the General Notes to the Schedule of the United States to Annex 2-D (Tariff Commitments); and

(ii) goods provided for in any other Table 1 provision shall continue to receive MFN tariff treatment.

(e) Starting on January 1 of year 15, originating goods of Australia provided for in Table 1 provision AG21050020 shall not count towards the quantities specified in subparagraph (b).

(f) Subparagraphs (a) through (d) apply to the following Table 1 provisions: AG04014025, AG04015025, AG04039016 and AG21050020.

(g) Subparagraph (e) applies to the following Table 1 provision: AG21050020.

8. CSQ-US4: Condensed Milk – Country-Specific Tariff-Rate Quota for Australia

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Australia described in subparagraph (e). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US4".

(b) In the year of entry into force of this Agreement as between the United States and Australia, the aggregate quantity of originating goods of Australia described in subparagraph (e) that shall be permitted to enter free of duty shall be equal to the volume permitted duty-free entry for that year under paragraph (6) of Annex I to the General Notes to the Tariff Schedule of the United States in Annex 2-B to the United States-Australia Free Trade Agreement, reduced by 5,000 MT.

In each year thereafter, the quantity shall increase at a compounded annual growth rate of six per cent.

The above quantities shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of Australia is in effect for the goods.

(c) In the year of entry into force of this Agreement as between the United States and Australia, the in-quota quantity set out in subparagraph (b) for that year shall be reduced by the in-quota amount imported during the year under paragraph (6) of Annex I to the General Notes to the Tariff Schedule of the United States in Annex 2-B to the United States-Australia Free Trade Agreement.

(d) Goods entered in aggregate quantities in excess of the quantities provided under subparagraphs (b) and (c) shall continue to receive MFN tariff treatment.

(e) Subparagraphs (a) through (d) apply to the following Table 1 provisions: AG04029170, AG04029190, AG04029945 and AG04029955.

9. CSQ-US5: Butter – Country-Specific Tariff-Rate Quota for Australia

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Australia described in subparagraph (e). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US5".

(b) The aggregate quantity of originating goods of Australia described in subparagraph (e) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in 2022, the quantity shall increase at a compounded annual growth rate of three per cent.

The above quantities shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of Australia is in effect for the goods.

(c) In the year of entry into force of this Agreement as between the United States and Australia, the in-quota quantity set out in subparagraph (b) for that year shall be reduced by the in-quota amount imported during the year under paragraph (7) of Annex I to the General Notes to the Tariff Schedule of the United States in Annex 2-B to the United States-Australia Free Trade Agreement.

(d) Goods entered in aggregate quantities in excess of the quantities provided under subparagraphs (b) and (c) shall continue to receive MFN tariff treatment.

(e) Subparagraphs (a) through (d) apply to the following Table 1 provisions: AG04015075, AG04022190, AG04039065, AG04039078, AG04051020, AG04052030, AG04059020, AG21069026 and AG21069036.

10. CSQ-US6: Milk Powders – Country-Specific Tariff-Rate Quota for Australia

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Australia described in subparagraph (e). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US6".

(b) In the year of entry into force of this Agreement as between the United States and Australia, the aggregate quantity of originating goods of Australia described in subparagraph (e) that shall be permitted to enter free of duty shall be equal to the combined volumes permitted duty-free entry for that year under paragraphs (8) and (10) of Annex I to the General Notes to the Tariff Schedule of the United States in Annex 2-B to the United States-Australia Free Trade Agreement.

In each year thereafter, the quantity shall increase at a compounded annual growth rate of two per cent.

The above quantities shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of Australia is in effect for the goods.

(c) In the year of entry into force of this Agreement as between the United States and Australia, the in-quota quantity set out in subparagraph (b) for that year shall be reduced by the in-quota amount imported during the year under paragraphs (8) and (10) of Annex I to the General Notes to the Tariff Schedule of the United States in Annex 2-B to the United States-Australia Free Trade Agreement.

(d) Duties on goods entered in aggregate quantities in excess of the quantities provided under subparagraphs (b) and (c) shall be removed in accordance with the provisions of staging category US24 in the General Notes to the Schedule of the United States to Annex 2-D (Tariff Commitments).

(e) Subparagraphs (a) through (d) apply to the following Table 1 provisions: AG04021050, AG04022125, AG04022150, AG04039045, AG04039055, AG04041090, AG23099028 and AG23099048.

11. CSQ-US7: Other Dairy Products – Country-Specific Tariff-Rate Quota for Australia

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Australia described in subparagraph (f). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US7".

(b) The aggregate quantity of originating goods of Australia described in subparagraph (f) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in 2022, the quantity shall increase at a compounded annual growth rate of six per cent.

The above quantities shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of Australia is in effect for the goods.

(c) In the year of entry into force of this Agreement as between the United States and Australia, the in-quota quantity set out in subparagraph (b) for that year shall be reduced by the in-quota amount imported during the year under paragraph (12) of Annex I to the General Notes to the Tariff Schedule of the United States in Annex 2-B to the United States-Australia Free Trade Agreement.

(d) With respect to goods described in subparagraph (f) entered in aggregate quantities in excess of the quantities provided under subparagraphs (b) and (c):

(i) for those goods provided for in Table 1 provisions AG19011030, AG19011040, AG19011075 and AG19011085, duties shall be removed in accordance with the provisions of staging category B15 in the General Notes to the Schedule of the United States to Annex 2-D (Tariff Commitments); and

(ii) goods provided for in any other Table 1 provision shall continue to receive MFN tariff treatment.

(e) Starting on January 1 of year 15, originating goods of Australia provided for in Table 1 provisions AG19011030, AG19011040, AG19011075 and AG19011085 shall not count towards the quantities specified in subparagraph (b).

(f) Subparagraphs (a) through (d) apply to the following Table 1 provisions: AG04022950, AG04029990, AG04031050, AG04039095, AG04041015, AG04049050, AG04052070, AG15179060, AG17049058, AG18062026, AG18062028, AG18062036, AG18062038, AG18062082, AG18062083, AG18062087, AG18062089, AG18063206, AG18063208, AG18063216, AG18063218, AG18063270, AG18063280, AG18069008, AG18069010, AG18069018, AG18069020, AG18069028, AG18069030, AG19011030, AG19011040, AG19011075, AG19011085, AG19012015, AG19012050, AG19019043, AG19019047, AG21050040, AG21069009, AG21069066, AG21069087, and AG22029028.

(g) Subparagraph (e) applies to the following Table 1 provisions: AG19011030, AG19011040, AG19011075 and AG19011085.

12. CSQ-US8: American and Cheddar Cheeses – Country-Specific Tariff-Rate Quota for Australia

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Australia described in subparagraph (e). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US8".

(b) In the year of entry into force of this Agreement as between the United States and Australia, the aggregate quantity of originating goods of Australia described in subparagraph (e) that shall be permitted to enter free of duty shall be equal to the combined volumes permitted duty-free entry for that year under paragraphs (14) and (16) of Annex I to the General Notes to the Tariff Schedule of the United States in Annex 2-B to the United States Australia Free Trade Agreement, plus 4,500 MT.

In each year thereafter, the quantity shall increase at a compounded annual growth rate of three per cent.

The above quantities shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of Australia is in effect for the goods.

(c) In the year of entry into force of this Agreement as between the United States and Australia, the in-quota quantity set out in subparagraph (b) for that year shall be reduced by the in-quota amount imported during the year under paragraphs (14) and (16) of Annex I to the General Notes to the Tariff Schedule of the United States in Annex 2-B to the United States-Australia Free Trade Agreement.

(d) Goods entered in aggregate quantities in excess of the quantities provided under subparagraphs (b) and (c) shall continue to receive MFN tariff treatment.

(e) Subparagraphs (a) through (d) apply to the following Table 1 provisions: AG04061028, AG04061038, AG04062033, AG04062039, AG04062067, AG04062071, AG04063028, AG04063038, AG04063067, AG04063071, AG04069012, AG04069054, AG04069078 and AG04069084.

13. CSQ-US9: Swiss-type, European-type and Other Cheeses – Country Specific Tariff-Rate Quota for Australia

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Australia described in subparagraph (f). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US9".

(b) In the year of entry into force of this Agreement as between the United States and Australia, the aggregate quantity of originating goods of Australia described in subparagraph (f) that shall be permitted to enter free of duty shall be equal to the combined volumes permitted duty-free entry for that year under paragraphs (18), (19) and (21) of Annex I to the General Notes to the Tariff Schedule of the United States in Annex 2-B to the United States Australia Free Trade Agreement, plus 4,500 MT.

In each year thereafter, the quantity shall increase at a compounded annual growth rate of five per cent.

The above quantities shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of Australia is in effect for the goods.

(c) In the year of entry into force of this Agreement as between the United States and Australia, the in-quota quantity set out in subparagraph (b) for that year shall be reduced by the in-quota amount imported during the year under paragraphs (18), (19) and (21) of Annex I to the General Notes to the Tariff Schedule of the United States in Annex 2-B to the United States-Australia Free Trade Agreement.

(d) With respect to goods described in subparagraph (f) entered in aggregate quantities in excess of the quantities provided under subparagraphs (b) and (c):

(i) for those goods provided for in Table 1 provision AG04069048, duties shall be removed in accordance with the provisions of staging category US19 in the General Notes to the Schedule of the United States to Annex 2-D (Tariff Commitments); and

(ii) goods provided for in any other Table 1 provision shall continue to receive MFN tariff treatment.

(e) Starting on January 1 of year 20, originating goods of Australia provided for in Table 1 provision AG04069048 shall not count towards the quantities specified in subparagraph (b).

(f) Subparagraphs (a) through (d) apply to the following Table 1 provisions: AG04061008, AG04061018, AG04061048, AG04061058, AG04061068, AG04061078, AG04061088, AG04062028, AG04062048, AG04062053, AG04062063, AG04062075, AG04062079, AG04062083, AG04062087, AG04062091, AG04063018, AG04063048, AG04063053, AG04063063, AG04063075, AG04063079, AG04063083, AG04063087, AG04063091, AG04064070, AG04069018, AG04069032, AG04069037, AG04069042, AG04069048, AG04069068, AG04069074, AG04069088, AG04069092, AG04069094, AG04069097 and AG19019036.

ANNEX 2-D – APPENDIX A – UNITED STATES – 11

(g) Subparagraph (e) applies to the following Table 1 provision: AG04069048.

14. CSQ-US10: Cheese – Country-Specific Tariff-Rate Quota for Canada

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Canada described in subparagraph (f). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US10".

(b) Subject to subparagraph (c), the aggregate quantity of originating goods of Canada described in subparagraph (f) that shall be permitted to enter free of duty in a particular year is specified in the Total Quantity column below, and the reserved portion of that quantity is specified in the Reserved Portion of the Total Quantity column below:

Starting in year 19, the Total Quantity shall remain at 20,486 MT per year and the Reserved Portion of the Total Quantity shall remain at 11,267 MT per year.

(c) In each year, the quantity specified in subparagraph (b) as the Reserved Portion of the Total Quantity shall only be available for the importation of goods in package sizes of 40 pounds or more. No package size limitations shall apply to the remainder of the Total Quantity specified in subparagraph (b).

(d) Except as provided in subparagraph (e), goods entered in aggregate quantities in excess of the total quantities listed in subparagraph (b), and goods in package sizes of less than 40 pounds entered in aggregate quantities in excess of the unreserved portions of those total quantities, shall continue to receive MFN tariff treatment.

(e) Duties on originating goods of Canada described in subparagraph (g) in pieces weighing no more than 10 kilograms and having a customs value in excess of 7.00 U.S. dollars per kilogram shall be removed in accordance with the provisions of staging category B10 in the General Notes to the Schedule of the United States to Annex 2-D (Tariff Commitments). Starting on January 1 of year 10, originating goods of Canada described in subparagraph (g) in pieces weighing no more than 10 kilograms and having a customs value in excess of 7.00 U.S. dollars per kilogram entered free of duty into the United States shall not count towards the quantities specified in subparagraph (b).

(f) Subparagraphs (a) through (d) apply to the following Table 1 provisions: AG04061008, AG04061018, AG04061028, AG04061038, AG04061048, AG04061058, AG04061068, AG04061078, AG04061088, AG04062028, AG04062033, AG04062039, AG04062048, AG04062053, AG04062063, AG04062067, AG04062071, AG04062075, AG04062079, AG04062083, AG04062087, AG04062091, AG04063018, AG04063028, AG04063038, AG04063048, AG04063053, AG04063063, AG04063067, AG04063071, AG04063075, AG04063079, AG04063083, AG04063087, AG04063091, AG04064070, AG04069012, AG04069018, AG04069032, AG04069037, AG04069042, AG04069048, AG04069054, AG04069068, AG04069074, AG04069078, AG04069084, AG04069088, AG04069092, AG04069094, AG04069097 and AG19019036.

(g) Subparagraph (e) applies to the following Table 1 provision: AG04069097.

15. CSQ-US11: Skim Milk Powder – Country-Specific Tariff-Rate Quota for Canada

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Canada described in subparagraph (d). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US11".

(b) The aggregate quantity of originating goods of Canada described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 19, the quantity shall remain at 17,622 MT per year.

(c) Goods entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall continue to receive MFN tariff treatment.

(d) Subparagraphs (a) through (c) apply to the following Table 1 provisions: AG04021050 and AG04022125.

16. CSQ-US12: Whole Milk Powder – Country-Specific Tariff-Rate Quota for Canada

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Canada described in subparagraph (d). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US12".

(b) The aggregate quantity of originating goods of Canada described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 19, the quantity shall remain at 4,552 MT per year.

(c) Goods entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall continue to receive MFN tariff treatment.

(d) Subparagraphs (a) through (c) apply to the following Table 1 provisions: AG04022150, AG04022950, AG23099028, and AG23099048.

17. CSQ-US13: Dried Yogurt, Sour Cream, Whey, and Products of Milk Constituents – Country-Specific Tariff-Rate Quota for Canada

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Canada described in subparagraph (d). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US13".

(b) The aggregate quantity of originating goods of Canada described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 19, the quantity shall remain at 14,226 MT per year.

(c) Goods entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall continue to receive MFN tariff treatment.

(d) Subparagraphs (a) through (c) apply to the following Table 1 provisions: AG04031050, AG04039045, AG04039055, AG04039095, AG04041015, AG04041090 and AG04049050.

18. CSQ-US14: Concentrated Milk – Country-Specific Tariff-Rate Quota for Canada

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Canada described in subparagraph (d). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US14".

(b) The aggregate quantity of originating goods of Canada described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 19, the quantity shall remain at 2,587 MT per year.

(c) Goods entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall continue to receive MFN tariff treatment.

(d) Subparagraphs (a) through (c) apply to the following Table 1 provisions: AG04029170, AG04029190, AG04029945, AG04029955 and AG04029990.

19. CSQ-US15: Cream, Sour Cream, Ice Cream, and Milk Beverages – Country-Specific Tariff-Rate Quota for Canada

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Canada described in subparagraph (d). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US15".

(b) The aggregate quantity of originating goods of Canada described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 19, the quantity shall remain at 9,673,793 litres per year.

(c) Goods entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall continue to receive MFN tariff treatment.

(d) Subparagraphs (a) through (c) apply to the following Table 1 provisions: AG04014025, AG04015025, AG04039016, AG21050020 and AG22029028.

20. CSQ-US16: Butter and Butter Substitutes – Country-Specific Tariff Rate Quota for Canada

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Canada described in subparagraph (e). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US16".

(b) The aggregate quantity of originating goods of Canada described in subparagraph (e) that shall be permitted to enter free of duty in a particular year is specified in the Total Quantity column below, and the reserved portion of that quantity is specified in the Reserved Portion of the Total Quantity column below:

Starting in year 19, the Total Quantity shall remain at 5,121 MT per year and the Reserved Portion of the Total Quantity shall remain at 4,353 MT per year.

(c) In each year, the quantities specified in subparagraph (b) as the Reserved Portion of the Total Quantity shall only be available for the importation of goods in package sizes of 55 pounds or more. No package size limitations shall apply to the remainder of the Total Quantity specified in subparagraph (b).

(d) Goods entered in aggregate quantities in excess of the total quantities listed in subparagraph (b), and goods in package sizes of less than 55 pounds entered in aggregate quantities in excess of the unreserved portions of those total quantities, shall continue to receive MFN tariff treatment.

(e) Subparagraphs (a) through (d) apply to the following Table 1 provisions: AG04015075, AG04022190, AG04039065, AG04039078, AG04051020, AG04052030, AG04052070, AG04059020, AG21069026 and AG21069036.

21. CSQ-US17: Other Dairy Products – Country-Specific Tariff-Rate Quota for Canada

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Canada described in subparagraph (e). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US17".

(b) The aggregate quantity of originating goods of Canada described in subparagraph (e) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 19, the quantity shall remain at 8,536 MT per year.

(c) With respect to goods described in subparagraph (e) entered in aggregate quantities in excess of the quantities listed in subparagraph (b):

(i) for those goods provided for in Table 1 provision AG15179060, duties shall be removed in accordance with the provisions of staging category B5 in the General Notes to the Schedule of the United States to Annex 2-D (Tariff Commitments); and

(ii) goods provided for in any other Table 1 provision shall continue to receive MFN tariff treatment.

(d) Starting on January 1 of year 5, originating goods of Canada provided for in Table 1 provision AG15179060 shall not count towards the quantities specified in subparagraph (b).

(e) Subparagraphs (a) through (c) apply to the following Table 1 provisions: AG15179060, AG17049058, AG18062026, AG18062028, AG18062036, AG18062038, AG18062082, AG18062083, AG18062087, AG18062089, AG18063206, AG18063208, AG18063216, AG18063218, AG18063270, AG18063280, AG18069008, AG18069010, AG18069018, AG18069020, AG18069028, AG18069030, AG19011030, AG19011040, AG19011075, AG19011085, AG19012015, AG19012050, AG19019043, AG19019047, AG21050040, AG21069009, AG21069066, and AG21069087.

(f) Subparagraph (d) applies to the following Table 1 provision: AG15179060.

22. CSQ-US18: Sugar – Country-Specific Tariff-Rate Quota for Canada

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Canada described in subparagraph (e). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US18".

(b) The aggregate quantity of originating goods of Canada described in subparagraph (e) that shall be permitted to enter free of duty in each year is 9,600 MT. However, no quantity shall be permitted to enter free of duty unless wholly obtained from sugar beets produced in Canada.

(c) In any year in which the United States Secretary of Agriculture (the Secretary) makes a determination to permit the importation into the United States at in-quota tariff rates of additional quantities of refined sugar (other than specialty sugar) above the quantities made available at those rates pursuant to its commitments under the WTO Agreement and other trade agreements, including this Agreement, (additional in-quota rate imports of refined sugar), the quantity set out for that year in subparagraph (b) shall be increased by an amount equal to 20 per cent of the quantity of additional in quota rate imports of refined sugar that the Secretary determines to permit to enter into the United States in that year. Any increase pursuant to this subparagraph of a quantity set out in subparagraph (b) shall not take effect until the date on which the additional in quota rate imports of refined sugar are permitted entry into the United States. Refined sugar imported pursuant to this subparagraph can be made from non-originating raw sugar. Nothing in this paragraph shall alter Canada's rights under the WTO Agreement with respect to any increase by the United States of the quantities of refined sugar permitted to be imported above the quantities made available at in-quota tariff rates pursuant to its commitments under the WTO Agreement and other trade agreements, including this Agreement.

(d) Goods entered in aggregate quantities in excess of the quantities provided under subparagraph (b) and, except as provided in subparagraph (c), goods not wholly obtained from sugar beets produced in Canada, shall continue to receive MFN tariff treatment.

(e) Subparagraphs (a) through (d) apply to the following Table I provisions: AG17011250, AG17011350, AG17011450, AG17019130, AG17019950, and AG17029020.

23. CSQ-US19: Sugar-Containing Products – Country-Specific Tariff Rate Quota for Canada

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Canada described in subparagraph (g). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US19".

(b) The aggregate quantity of originating goods of Canada described in subparagraph (g) that shall be permitted to enter free of duty in each year is 9,600 MT.

(c) In any year for which Canada has provided the United States with a written notification in accordance with the terms of subparagraph (d) of Canada's intent to require export certificates for the exportation of goods for import under this TRQ, the above quantity shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of Canada is in effect for the goods.

(d) Canada shall provide the United States with the notification referred to in subparagraph (c) at least 150 days prior to the start of each year in which Canada requires an export certificate for the exportation of goods for import under this TRQ. Canada shall provide the notification in writing to the U.S. Contact Point designated pursuant to Article 27.5 (Contact Points).

(e) Goods entered within the quantity listed in subparagraph (b) that are provided for in Table 1 provisions AG17019148, AG17019158, AG17022028, AG17023028, AG17024028, AG17026028, AG17029058, AG17029068, AG18061015, AG18061028, AG18061038, AG18061055, AG18061075, and AG21069046 can be made from sugar refined in Canada. Refined means a change to a good of HS subheading 1701.91 or 1701.99 from any other subheading.

(f) Goods entered in aggregate quantities in excess of the quantity listed in subparagraph (b) shall continue to receive MFN tariff treatment.

(g) Subparagraphs (a) through (f) apply to the following Table I provisions: AG17019148, AG17019158, AG17022028, AG17023028, AG17024028, AG17026028, AG17029058, AG17029068, AG17049068, AG17049078, AG18061015, AG18061028, AG18061038, AG18061055, AG18061075, AG18062073, AG18062077, AG18062094, AG18062098, AG18069039, AG18069049, AG18069059, AG19012025, AG19012035, AG19012060, AG19012070, AG19019054, AG19019058, AG21011238, AG21011248, AG21011258, AG21012038, AG21012048, AG21012058, AG21039078, AG21069046, AG21069072, AG21069076, AG21069080, AG21069091, AG21069094 and AG21069097.

24. CSQ-US20: Sugar and Sugar-Containing Products – Country Specific Tariff-Rate Quota for Chile

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Chile described in subparagraph (f). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US20".

(b) In any year, duty-free tariff treatment for originating goods of Chile described in subparagraph (f) shall be accorded to a quantity of goods equal to the amount of Chile's trade surplus, by volume, from all sources for goods in the following subheadings: HS1701.11, HS1701.12, HS1701.91, HS1701.99, HS1702.20, HS1702.30, HS1702.40, HS1702.60, HS1702.90, HS1806.10 and HS2106.90, except that Chile's imports of originating goods of the United States under HS1702.40 and HS1702.60 shall not be included in the calculation of Chile's trade surplus. Chile's trade surplus will be calculated using the most recent annual data available.

(c) In the year of entry into force of this Agreement as between the United States and Chile, the in-quota quantity set out in subparagraph (b) for that year shall be reduced by the in-quota amount imported during that year, but prior to entry into force of this Agreement as between the United States and Chile, under paragraph (9) of Annex 1 to the General Notes to the Tariff Schedule of the United States in Annex 3.3 to the United States – Chile Free Trade Agreement.

(d) Notwithstanding Article 2.30.4 (Allocation), upon entry into force of this Agreement as between the United States and Chile, and continuing for as long as this Agreement remains in force between the United States and Chile:

(i) Any quantity of goods imported into the United States under the TRQ set out in paragraph (9) of Annex 1 to the General Notes to the Tariff Schedule of the United States in Annex 3.3 to the United States – Chile Free Trade Agreement shall count towards both:

(A) the quantity of goods that may be imported under the TRQ set out in paragraph (9) of Annex 1 to the General Notes to the Tariff Schedule of the United States in Annex 3.3 to the United States – Chile Free Trade Agreement; and

(B) the quantity of goods that may be imported under this TRQ, and

(ii) any quantity of goods imported into the United States under this TRQ shall count towards both:

(A) the quantity of goods that may be imported under this TRQ; and

(B) the quantity of goods that may be imported under the TRQ set out in paragraph (9) of Annex 1 to the General Notes to the Tariff Schedule of the United States in Annex 3.3 to the United States – Chile Free Trade Agreement.

(e) Goods entered in aggregate quantities in excess of the quantities provided under subparagraphs (b) through (d) shall receive MFN tariff treatment.

(f) Subparagraphs (a) through (e) apply to the following Table 1 provisions: AG17011250, AG17011350, AG17011450, AG17019130, AG17019148, AG17019158, AG17019950, AG17022028, AG17023028, AG17024028, AG17026028, AG17029020, AG17029058, AG17029068, AG17049068, AG17049078, AG18061028, AG18061038, AG18061055, AG18061075, AG19012060, AG19012070, AG19019054, AG19019058, AG21069046, AG21069076, AG21069080, AG21069094 and AG21069097.

25. CSQ-US21: Beef – Country-Specific Tariff-Rate Quota for Japan

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Japan described in subparagraph (d). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US21".

(b) The aggregate quantity of originating goods of Japan described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

(c) Duties on goods entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be removed in accordance with the provisions of staging category B15 in the General Notes to the Schedule of the United States to Annex 2-D (Tariff Commitments).

(d) Subparagraphs (a) through (c) apply to the following Table 1 provisions: AG02011050, AG02012080, AG02013080, AG02021050, AG02022080 and AG02023080.

26. CSQ-US22: Sugar and Sugar-Containing Products – Country Specific Tariff-Rate Quota for Japan

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Japan described in subparagraph (d). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US22".

(b) The aggregate quantity of originating goods of Japan described in subparagraph (d) that shall be permitted to enter free of duty in each year is 100 MT.

(c) Goods entered in aggregate quantity in excess of the quantity listed in subparagraph (b) shall continue to receive MFN tariff treatment.

(d) Subparagraphs (a) through (c) apply to the following Table 1 provisions: AG17011250, AG17011350, AG17011450, AG17019130, AG17019148, AG17019158, AG17019950, AG17022028, AG17023028, AG17024028, AG17026028, AG17029020, AG17029058, AG17029068, AG17049068, AG17049078, AG18061055, AG18061075 and AG21069046.

27. CSQ-US23: Sugar and Sugar-Containing Products – Country Specific Tariff-Rate Quota for Malaysia

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Malaysia described in subparagraph (d). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US23".

(b) The aggregate quantity of originating goods of Malaysia described in subparagraph (d) that shall be permitted to enter free of duty in each year is 500 MT.

(c) Goods entered in aggregate quantities in excess of the quantity listed in subparagraph (b) shall continue to receive MFN tariff treatment.

(d) Subparagraphs (a) through (c) apply to the following Table I provisions: AG17011250, AG17011350, AG17011450, AG17019130, AG17019148, AG17019158, AG17019950, AG17022028, AG17023028, AG17024028, AG17026028, AG17029020, AG17029058, AG17029068, AG17049068, AG17049078, AG18061055, AG18061075 and AG21069046.

28. CSQ-US24: Cheese – Country-Specific Tariff-Rate Quota for New Zealand

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of New Zealand described in subparagraph (e). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US24".

(b) The aggregate quantity of originating goods of New Zealand described in subparagraph (e) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 31, the quantity shall increase by 3 per cent per year, compounded annually. The above quantities shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of New Zealand is in effect for the goods.

(c) With respect to goods described in subparagraph (e) entered in aggregate quantities in excess of the quantities listed in subparagraph (b):

(i) for those goods provided for in Table 1 provision AG04069097, duties shall be removed in accordance with the provisions of staging category US23 in the General Notes to the Schedule of the United States to Annex 2-D (Tariff Commitments); and

(ii) goods provided for in any other Table 1 provision shall continue to receive MFN tariff treatment.

(d) Starting on January 1 of year 20, originating goods of New Zealand provided for in Table 1 provision AG04069097 shall not count towards the quantities specified in subparagraph (b).

(e) Subparagraphs (a) through (c) apply to the following Table 1 provisions: AG04061008, AG04061018, AG04061028, AG04061038, AG04061048, AG04061058, AG04061068, AG04061078, AG04061088, AG04062028, AG04062033, AG04062039, AG04062048, AG04062053, AG04062063, AG04062067, AG04062071, AG04062075, AG04062079, AG04062083, AG04062087, AG04062091, AG04063018, AG04063028, AG04063038, AG04063048, AG04063053, AG04063063, AG04063067, AG04063071, AG04063075, AG04063079, AG04063083, AG04063087, AG04063091, AG04064070, AG04069012, AG04069018, AG04069032, AG04069037, AG04069042, AG04069048, AG04069054, AG04069068, AG04069074, AG04069078, AG04069084, AG04069088, AG04069092, AG04069094, AG04069097 and AG19019036.

(f) Subparagraph (d) applies to the following Table 1 provision: AG04069097.

29. CSQ-US25: Skim Milk Powder – Country-Specific Tariff-Rate Quota for New Zealand

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of New Zealand described in subparagraph (d). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US25".

(b) The aggregate quantity of originating goods of New Zealand described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

The above quantities shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of New Zealand is in effect for the goods.

(c) Duties on goods entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be removed in accordance with the provisions of staging category B20 in the General Notes to the Schedule of the United States to Annex 2-D (Tariff Commitments).

(d) Subparagraphs (a) through (c) apply to the following Table 1 provisions: AG04021050 and AG04022125.

30. CSQ-US26: Whole Milk Powder – Country-Specific Tariff-Rate Quota for New Zealand

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of New Zealand described in subparagraph (d). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US26".

(b) The aggregate quantity of originating goods of New Zealand described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

The above quantities shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of New Zealand is in effect for the goods.

(c) Duties on goods entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be removed in accordance with staging category US24 in the General Notes to the Schedule of the United States to Annex 2-D (Tariff Commitments).

(d) Subparagraphs (a) through (c) apply to the following Table 1 provisions: AG04022150, AG04039045, AG04039055, AG04041090, AG23099028 and AG23099048.

31. CSQ-US27: Concentrated Milk – Country-Specific Tariff-Rate Quota for New Zealand

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of New Zealand described in subparagraph (d). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US27".

(b) The aggregate quantity of originating goods of New Zealand described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 31, the quantity shall increase by 3 per cent per year, compounded annually. The above quantities shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of New Zealand is in effect for the goods.

(c) Goods entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall continue to receive MFN tariff treatment.

(d) Subparagraphs (a) through (c) apply to the following Table 1 provisions: AG04029170, AG04029190, AG04029945 and AG04029955.

32. CSQ-US28: Creams – Country-Specific Tariff-Rate Quota for New Zealand

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of New Zealand described in subparagraph (d). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US28".

(b) The aggregate quantity of originating goods of New Zealand described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 31, the quantity shall increase by 6 per cent per year, compounded annually. The above quantities shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of New Zealand is in effect for the goods.

(c) Goods entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall continue to receive MFN tariff treatment.

(d) Subparagraphs (a) through (c) apply to the following Table 1 provisions: AG04014025, AG04015025 and AG04039016.

33. CSQ-US29: Butter and Butter Substitutes – Country-Specific Tariff Rate Quota for New Zealand

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of New Zealand described in subparagraph (e). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US29".

(b) Subject to subparagraph (c), the aggregate quantity of originating goods of New Zealand described in subparagraph (e) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 31, the quantity shall increase by 3 per cent per year, compounded annually. The above quantities shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of New Zealand is in effect for the goods.

(c) Of the quantities listed in subparagraph (b), the following quantities shall be reserved exclusively for importation of the goods described in subparagraph (f):

(d) Goods entered in aggregate quantities in excess of the quantities specified pursuant to subparagraphs (b) and (c) shall continue to receive MFN tariff treatment.

(e) Subparagraphs (a), (b) and (d) apply to the following Table 1 provisions: AG04015075, AG04022190, AG04039065, AG04039078, AG04051020, AG04052030, AG04059020, AG21069026 and AG21069036.

(f) Subparagraph (c) applies to the following Table 1 provision: AG04059020.

34. CSQ-US30: Organic Butter – Country-Specific Tariff-Rate Quota for New Zealand

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of New Zealand described in subparagraph (e). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US30".

(b) The aggregate quantity of originating goods of New Zealand described in subparagraph (e) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 31, the quantity shall increase by three per cent per year, compounded annually. The above quantities shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of New Zealand is in effect for the goods.

(c) The United States shall require that, in order to be eligible to be imported into the United States free of duty pursuant to this paragraph, a good be labeled as "organic" and meet the requirements set out in U.S. regulations to be sold, labeled, or represented as "organic" in the United States, including those requirements related to the certification of operations involved in the production or handling of the good.

(d) Goods entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall continue to receive MFN tariff treatment.

(e) Subparagraphs (a) through (d) apply to the following Table 1 provision: AG04051020.

35. CSQ-US31: Other Dairy Products – Country-Specific Tariff-Rate Quota for New Zealand

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of New Zealand described in subparagraph (d). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US31".

(b) The aggregate quantity of originating goods of New Zealand described in subparagraph (d) that shall be permitted to enter free of duty in a particular year is specified below:

Starting in year 31, the quantity shall increase by five per cent per year, compounded annually. The above quantities shall only be eligible for duty-free treatment if the U.S. importer makes a declaration to U.S. Customs and Border Protection (Customs), in the form and manner determined by Customs, that a valid export certificate issued by the Government of New Zealand is in effect for the goods.

(c) Goods entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall continue to receive MFN tariff treatment.

(d) Subparagraphs (a) through (c) apply to the following Table 1 provisions: AG04022950, AG04029990, AG04031050, AG04039095, AG04041015, AG04049050, AG04052070, AG15179060, AG17049058, AG18062026, AG18062028, AG18062036, AG18062038, AG18062082, AG18062083, AG18062087, AG18062089, AG18063206, AG18063208, AG18063216, AG18063218, AG18063270, AG18063280, AG18069008, AG18069010, AG18069018, AG18069020, AG18069028, AG18069030, AG19012015, AG19012050, AG19019043, AG19019047, AG21050040, AG21069009, AG21069066, AG21069087 and AG22029028.

36. CSQ-US32: Cheese – Country-Specific Tariff-Rate Quota for Peru

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Peru described in subparagraph (f). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US32".

(b) Subject to subparagraphs (c) and (d), the aggregate quantity of originating goods of Peru described in subparagraph (f) that shall be permitted to enter free of duty in a particular year is specified below:

(c) In the year of entry into force of this Agreement as between the United States and Peru, the in-quota quantity set out in subparagraph (b) for that year shall be reduced by the in quota amount imported during that year, but prior to entry into force of this Agreement as between the United States and Peru, under paragraph (2) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States-Peru Trade Promotion Agreement.

(d) Notwithstanding Article 2.30.4 (Allocation), upon entry into force of this Agreement as between the United States and Peru, and continuing for as long as this Agreement remains in force between the United States and Peru:

(i) any quantity of goods imported into the United States under the TRQ set out in paragraph (2) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States – Peru Trade Promotion Agreement shall count towards both:

(A) the quantity of goods that may be imported under the TRQ set out in paragraph (2) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States-Peru Trade Promotion Agreement; and

(B) the quantity of goods that may be imported under this TRQ; and

(ii) any quantity of goods imported into the United States under this TRQ shall count towards both:

(A) the quantity of goods that may be imported under this TRQ; and

(B) the quantity of goods that may be imported under the TRQ set out in paragraph (2) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States – Peru Trade Promotion Agreement.

(e) The rate of duty on goods entered in aggregate quantities in excess of the quantities provided under subparagraphs (b) through (d) shall be equal to the rate of duty applicable pursuant to paragraph 2(b) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States – Peru Trade Promotion Agreement for goods entered in aggregate quantities in excess of the quantities listed in paragraph 2(a) of that Appendix.

(f) Subparagraphs (a) through (e) apply to the following Table 1 provisions: AG04061008, AG04061018, AG04061028, AG04061038, AG04061048, AG04061058, AG04061068, AG04061078, AG04061088, AG04062028, AG04062033, AG04062039, AG04062048, AG04062053, AG04062063, AG04062067, AG04062071, AG04062075, AG04062079, AG04062083, AG04062087, AG04062091, AG04063018, AG04063028, AG04063038, AG04063048, AG04063053, AG04063063, AG04063067, AG04063071, AG04063075, AG04063079, AG04063083, AG04063087, AG04063091, AG04064070, AG04069012, AG04069018, AG04069032, AG04069037, AG04069042, AG04069048, AG04069054, AG04069068, AG04069074, AG04069078, AG04069084, AG04069088, AG04069092, AG04069094, AG04069097 and AG19019036.

37. CSQ-US33: Condensed and Evaporated Milk – Country-Specific Tariff-Rate Quota for Peru

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Peru described in subparagraph (f). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US33".

(b) Subject to subparagraphs (c) and (d), the aggregate quantity of originating goods of Peru described in subparagraph (f) that shall be permitted to enter free of duty in a particular year is specified below:

(c) In the year of entry into force of this Agreement as between the United States and Peru, the in-quota quantity set out in subparagraph (b) for that year shall be reduced by the in-quota amount imported during that year, but prior to entry into force of this Agreement as between the United States and Peru, under paragraph (3) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States Peru Trade Promotion Agreement.

(d) Notwithstanding Article 2.30.4 (Allocation), upon entry into force of this Agreement as between the United States and Peru, and continuing for as long as this Agreement remains in force between the United States and Peru:

(i) any quantity of goods imported into the United States under the TRQ set out in paragraph (3) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States – Peru Trade Promotion Agreement shall count towards both:

(A) the quantity of goods that may be imported under the TRQ set out in paragraph (3) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States-Peru Trade Promotion Agreement; and

(B) the quantity of goods that may be imported under this TRQ; and

(ii) any quantity of goods imported into the United States under this TRQ shall count towards both:

(A) the quantity of goods that may be imported under this TRQ; and

(B) the quantity of goods that may be imported under the TRQ set out in paragraph (3) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States – Peru Trade Promotion Agreement.

(e) The rate of duty on goods entered in aggregate quantities in excess of the quantities provided under subparagraphs (b) through (d) shall be equal to the rate of duty applicable pursuant to paragraph 3(b) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States – Peru Trade Promotion Agreement for goods entered in aggregate quantities in excess of the quantities listed in paragraph 3(a) of that Appendix.

(f) Subparagraphs (a) through (e) apply to the following Table 1 provisions: AG04029170, AG04029190, AG04029945 and AG04029955.

38. CSQ-US34: Processed Dairy Products – Country-Specific Tariff-Rate Quota for Peru

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Peru described in subparagraph (f). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US34".

(b) Subject to subparagraphs (c) and (d), the aggregate quantity of originating goods of Peru described in subparagraph (f) that shall be permitted to enter free of duty in a particular year is specified below:

(c) In the year of entry into force of this Agreement as between the United States and Peru, the in-quota quantity set out in subparagraph (b) for that year shall be reduced by the in-quota amount imported during that year, but prior to entry into force of this Agreement as between the United States and Peru, under paragraph (4) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States Peru Trade Promotion Agreement.

(d) Notwithstanding Article 2.30.4 (Allocation), upon entry into force of this Agreement as between the United States and Peru, and continuing for as long as this Agreement remains in force between the United States and Peru:

(i) any quantity of goods imported into the United States under the TRQ set out in paragraph (4) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States – Peru Trade Promotion Agreement shall count towards both:

(A) the quantity of goods that may be imported under the TRQ set out in paragraph (4) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States-Peru Trade Promotion Agreement; and

(B) the quantity of goods that may be imported under this TRQ; and

(ii) any quantity of goods imported into the United States under this TRQ shall count towards both:

(A) the quantity of goods that may be imported under this TRQ; and

(B) the quantity of goods that may be imported under the TRQ set out in paragraph (4) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States – Peru Trade Promotion Agreement.

(e) The rate of duty on goods entered in aggregate quantities in excess of the quantities provided under subparagraphs (b) through (d) shall be equal to the rate of duty applicable pursuant to paragraph 4(b) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States – Peru Trade Promotion Agreement for goods entered in aggregate quantities in excess of the quantities listed in paragraph 4(a) of that Appendix.

(f) Subparagraphs (a) through (e) apply to the following Table 1 provisions: AG04022950, AG04029990, AG04031050, AG04039095, AG04041015, AG04049050, AG04052070, AG15179060, AG17049058, AG18062082, AG18062083, AG18063270, AG18063280, AG18069008, AG18069010, AG19011040, AG19011085, AG19012015, AG19012050, AG19019043, AG19019047, AG21050040, AG21069009, AG21069066, AG21069087 and AG22029028.

39. CSQ-US35 & CSQ-US36: Sugar and Sugar-Containing Products – Country-Specific Tariff-Rate Quotas for Peru

(a) This paragraph sets out country-specific tariff-rate quotas for the originating goods of Peru described in subparagraphs (g) and (n).

(b) Subparagraph (c) sets out a country-specific tariff-rate quota for the originating goods of Peru described in subparagraph (g). The TRQ set out in subparagraph (c) is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US35".

(c) Subject to subparagraphs (d), (e), and (h), the aggregate quantity of originating goods of Peru described in subparagraph (g) that shall be permitted to enter free of duty in a particular year is specified below:

After 2023, the in-quota quantity grows at 180 MT per year.

The quantities of goods under the following tariff items shall be entered on a raw-value-equivalent basis: AG17011250, AG17011350, AG17011450, AG17019130, AG17019950, AG17029020, and AG21069046. Raw-value equivalents for sugar goods are contained in Chapter 17, U.S. Additional Note 5(c) to the HTSUS.

The United States may administer the duty-free quantities established in this subparagraph through regulations, including licenses.

(d) In the year of entry into force of this Agreement as between the United States and Peru, the in-quota quantity set out in subparagraph (c) for that year shall be reduced by the in-quota amount imported during that year, but prior to entry into force of this Agreement as between the United States and Peru, under paragraph (5a) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States Peru Trade Promotion Agreement.

(e) Notwithstanding Article 2.30.4 (Allocation), upon entry into force of this Agreement as between the United States and Peru, and continuing for as long as this Agreement remains in force between the United States and Peru:

(i) any quantity of goods imported into the United States under the TRQ set out in paragraph (5a) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States – Peru Trade Promotion Agreement below shall count towards both:

(A) the quantity of goods that may be imported under the TRQ set out in paragraph (5a) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United StatesPeru Trade Promotion Agreement; and

(B) the quantity of goods that may be imported under the TRQ set out in subparagraph (c) of this Paragraph; and

(ii) any quantity of goods imported into the United States under the TRQ set out in subparagraph (c) of this Paragraph shall count towards both:

(A) the quantity of goods that may be imported under that TRQ; and

(B) the quantity of goods that may be imported under the TRQ set out in paragraph (5a) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States–Peru Trade Promotion Agreement.

(f) Goods entered in aggregate quantities in excess of the quantities provided under subparagraphs (c) through (e) and (h) shall continue to receive MFN tariff treatment.

(g) Subparagraphs (a) through (f) and (h) apply to the following Table 1 provisions: AG17011250, AG17011350, AG17011450, AG17019130, AG17019148, AG17019158, AG17019950, AG17022028, AG17023028, AG17024028, AG17026028, AG17029020, AG17029058, AG17029068, AG17049068, AG17049078, AG18061015, AG18061028, AG18061038, AG18061055, AG18061075, AG18062073, AG18062077, AG18062094, AG18062098, AG18069039, AG18069049, AG18069059, AG19012025, AG19012035, AG19012060, AG19012070, AG19019054, AG19019058, AG21011238, AG21011248, AG21011258, AG21012038, AG21012048, AG21012058, AG21039078, AG21069046, AG21069072, AG21069076, AG21069080, AG21069091, AG21069094 and AG21069097.

(h) In any year, duty-free tariff treatment under subparagraph (c) for Peru shall be accorded to the lesser of (i) the aggregate quantity set out in subparagraph (c) for Peru, or (ii) a quantity equal to the amount by which Peru's exports to all destinations exceeds its imports from all sources ("trade surplus") for goods classified under the following subheadings: HS1701.11, HS1701.12, HS1701.91, HS1701.99, HS1702.40, and HS1702.60, except that Peru's exports to the United States of goods classified under subheadings HS1701.11, HS1701.12, HS1701.91, and HS1701.99 and its imports of goods of the United States, whether or not originating, classified under HS1702.40 and HS1702.60 shall not be included in the calculation of its trade surplus. Peru's trade surplus will be calculated using the most recent annual data available.

(i) Subparagraph (j) sets out a country-specific tariff-rate quota for the originating goods of Peru described in subparagraph (n). The TRQ set out in subparagraph (j) is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US36".

(j) Subject to subparagraphs (k) and (l), the aggregate quantity of goods of Peru entered under the provisions listed in subparagraph (n) shall be free of duty in any calendar year and shall not exceed 2,000 MT in any year.

(k) In the year of entry into force of this Agreement as between the United States and Peru, the in-quota quantity set out in paragraph (j) for that year shall be reduced by the in-quota amount imported during that year, but prior to entry into force of this Agreement as between the United States and Peru, under paragraph (5e) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States – Peru Trade Promotion Agreement.

(l) Notwithstanding Article 2.30.4 (Allocation), upon entry into force of this Agreement as between the United States and Peru, and continuing for as long as this Agreement remains in force between the United States and Peru:

(i) any quantity of goods imported into the United States under the TRQ set out in paragraph (5e), Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States – Peru Trade Promotion Agreement below shall count towards both:

(A) the quantity of goods that may be imported under the TRQ set out in paragraph (5e) of Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States Peru Trade Promotion Agreement; and

(B) the quantity of goods that may be imported under the TRQ set out in subparagraph (j) of this Paragraph.

(ii) any quantity of goods imported into the United States under the TRQ set out in subparagraph (j) of this Paragraph shall count towards both:

(A) the quantity of goods that may be imported under that TRQ; and

(B) the quantity of goods that may be imported under the TRQ set out in paragraph (5e), Appendix I to the General Notes to the Tariff Schedule of the United States in Annex 2.3 to the United States – Peru Trade Promotion Agreement.

(m) Goods entered in aggregate quantities in excess of the quantities provided under subparagraphs (j) through (l) shall continue to receive MFN tariff treatment.

(n) Subparagraphs (i) through (m) apply to specialty sugars as provided for in Additional U.S. Note 5 to Chapter 17 of the Harmonized Tariff Schedule of the United States and classified in the following Table 1 provisions: AG17011210, AG17011310,

AG17011410, AG17019110, AG17019910, AG17029010 and AG21069044.

40. CSQ-US37: Sugar and Sugar-Containing Products – Country Specific Tariff-Rate Quota for Vietnam

(a) This paragraph sets out a country-specific tariff-rate quota for the originating goods of Vietnam described in subparagraph (d). The TRQ set out in this paragraph is designated in the Schedule of the United States to Annex 2-D (Tariff Commitments) with the designation "CSQ-US37".

(b) The aggregate quantity of originating goods of Vietnam described in subparagraph (d) that shall be permitted to enter free of duty in each year is 1,500 MT.

(c) Goods entered in aggregate quantities in excess of the quantity listed in subparagraph (b) shall continue to receive MFN tariff treatment.

(d) Subparagraphs (a) through (c) apply to the following Table 1 provisions: AG17011250, AG17011350, AG17011450, AG17019130, AG17019148, AG17019158, AG17019950, AG17022028, AG17023028, AG17024028, AG17026028, AG17029020, AG17029058, AG17029068, AG17049068, ANNEX 2-D – APPENDIX A – UNITED STATES – 49 AG17049078, AG18061015, AG18061028, AG18061038, AG18061055, AG18061075, AG18062073, AG18062077, AG18062094, AG18062098, AG18069039, AG18069049, AG18069059, AG19012025, AG19012035, AG19012060, AG19012070, AG21012038, AG21012048, AG21069046 and AG21069094.


APPENDIX B

AGRICULTURAL SAFEGUARD MEASURES OF THE UNITED STATES

1. This Appendix sets out certain country-specific safeguard measures that the United States may apply, notwithstanding Article 2.4 (Elimination of Customs Duties). For the purposes of this Appendix, the term "metric tonnes" shall be abbreviated as "MT".

2. The United States shall implement any agricultural safeguard measure under this Appendix in a transparent manner, taking reasonable steps to publicly disclose the volume entering under the safeguard. As soon as practicable after commencing application of an agricultural safeguard measure under this Appendix, the United States shall notify in writing the other Party identified in the chapeau of the paragraph below setting out that safeguard and shall provide that other Party with relevant data concerning the measure. On request, the United States shall consult with that other Party regarding the application of the measure.

3. For the purposes of this Appendix, an originating good shall be deemed to be of the Party identified in the chapeau of the paragraph setting out the safeguard if the United States would apply for that good the rate of customs duty for the originating good of that Party pursuant to:

(a) paragraph 8 in Section B (Tariff Differentials) of Annex 2-D (Tariff Commitments), if the relevant tariff item is not listed in Appendix C (Tariff Differentials) to the Schedule of the United States to Annex 2-D (Tariff Commitments); or

(b) paragraph 1 or paragraph 2(a), as applicable, of Appendix C (Tariff Differentials) to the Schedule of the United States to Annex 2-D (Tariff Commitments), if the relevant tariff item is listed in that Appendix.

SG-US1: Country-Specific Safeguard Measure for Australia for Swiss Cheese

4. This paragraph sets out a country-specific safeguard measure for the originating goods of Australia described in subparagraph (f). The safeguard measure is designated in the Schedule of the United States to Annex 2-D with the designation SG-US1.

(a) Notwithstanding Article 2.4 (Elimination of Customs Duties), the United States may apply an agricultural safeguard measure in the form of an additional import duty on originating goods of Australia described in subparagraph (f), provided that the conditions in subparagraphs (b) through (e) are met. The sum of any such additional import duty and any other customs duty on such good shall not exceed the least of:

(i) the safeguard duty specified in subparagraph (c);

(ii) the most-favoured-nation (MFN) applied rate of duty in effect on the day immediately preceding the date of entry into force of this Agreement for the United States; or

(iii) the prevailing MFN applied rate of duty.

(b) The United States may apply an agricultural safeguard measure during any calendar year on originating goods of Australia described in subparagraph (f) if the quantity of imports during such year exceeds the trigger quantity as specified below:

In years 2 through 24, the trigger quantity shall increase at a compounded annual growth rate of 3 per cent.

(c) For purposes of subparagraph (a), the safeguard duty for each year shall be:

(d) The United States may maintain an agricultural safeguard measure under this paragraph only until the end of the calendar year.

(e) The United States shall not apply or maintain an agricultural safeguard measure under this paragraph on a good after January 1 of year 25.

(f) This paragraph applies to the following Table 2 provision: AG04069048.

SG-US2: Country-Specific Safeguard Measure for Australia for Milk Powders

5. This paragraph sets out a country-specific safeguard measure for the originating goods of Australia described in subparagraph (f). The safeguard measure is designated in the Schedule of the United States to Annex 2-D with the designation SG-US2.

(a) Notwithstanding Article 2.4 (Elimination of Customs Duties), the United States may apply an agricultural safeguard measure in the form of an additional import duty on originating goods of Australia described in subparagraph (f), provided that the conditions in subparagraphs (b) through (e) are met. The sum of any such additional import duty and any other customs duty on such good shall not exceed the least of:

(i) the safeguard duty specified in subparagraph (c);

(ii) the most-favoured-nation (MFN) applied rate of duty in effect on the day immediately preceding the date of entry into force of this Agreement for the United States; or

(iii) the prevailing MFN applied rate of duty.

(b) The United States may apply an agricultural safeguard measure during any calendar year on originating goods of Australia described in subparagraph (f) if the quantity of imports during such year exceeds the trigger quantity as specified below:

(i) In the year of entry into force of the Agreement as between the United States and Australia, the trigger quantity shall be the in-quota quantity for the goods of Australia described in subparagraph (f) for that year, as set out in paragraph 10(b) of Appendix A to the Schedule of the United States to Annex 2- D (Tariff Rate Quotas of the United States), increased by 700 MT.

(ii) In each subsequent year until year 35, the trigger quantity shall increase at a compounded annual growth rate of 2 per cent.

(c) For purposes of subparagraph (a), the safeguard duty for each year shall be:

(d) The United States may maintain an agricultural safeguard measure under this paragraph only until the end of the calendar year.

(e) The United States shall not apply or maintain an agricultural safeguard measure under this paragraph on a good after January 1 of year 35.

(f) This paragraph applies to the following Table 2 provisions: AG04021050, AG04022125, AG04022150, AG04039045, AG04039055, AG04041090, AG23099028 and AG23099048.

SG-US3: Country-Specific Safeguard Measure for New Zealand for Other Cheese

6. This paragraph sets out a country-specific safeguard measure for the originating goods of New Zealand described in subparagraph (f). The safeguard measure is designated in the Schedule of the United States to Annex 2-D with the designation SG-US3.

(a) Notwithstanding Article 2.4 (Elimination of Customs Duties), the United States may apply an agricultural safeguard measure in the form of an additional import duty on originating goods of New Zealand described in subparagraph (f), provided that the conditions in subparagraphs (b) through (e) are met. The sum of any such additional import duty and any other customs duty on such good shall not exceed the least of:

(i) the safeguard duty specified in subparagraph (c);

(ii) the most-favoured-nation (MFN) applied rate of duty in effect on the day immediately preceding the date of entry into force of this Agreement for the United States; or

(iii) the prevailing MFN applied rate of duty.

(b) The United States may apply an agricultural safeguard measure during any calendar year on originating goods of New Zealand described in subparagraph (f) if the quantity of imports during such year exceeds the trigger quantity as specified below:

In years 13 through 24, the trigger quantity shall increase at a compounded annual growth rate of 3 per cent.

(c) For purposes of subparagraph (a), the safeguard duty for each year shall be:

(d) The United States may maintain an agricultural safeguard measure under this paragraph only until the end of the calendar year.

(e) The United States shall not apply or maintain an agricultural safeguard measure under this paragraph on a good after January 1 of year 25.

(f) This paragraph applies to the following Table 2 provision: AG04069097.

SG-US4: Country-Specific Safeguard Measure for New Zealand for Whole Milk Powder

7. This paragraph sets out a country-specific safeguard measure for the originating goods of New Zealand described in subparagraph (f). The safeguard measure is designated in the Schedule of the United States to Annex 2-D with the designation SG-US4.

(a) Notwithstanding Article 2.4 (Elimination of Customs Duties), the United States may apply an agricultural safeguard measure in the form of an additional import duty on originating goods of New Zealand described in subparagraph (f), provided that the conditions in subparagraphs (b) through (e) are met. The sum of any such additional import duty and any other customs duty on such good shall not exceed the least of:

(i) the safeguard duty specified in subparagraph (c);

(ii) the most-favoured-nation (MFN) applied rate of duty in effect on the day immediately preceding the date of entry into force of this Agreement for the United States; or

(iii) the prevailing MFN applied rate of duty.

(b) The United States may apply an agricultural safeguard measure during any calendar year on originating goods of New Zealand described in subparagraph (f) if the quantity of imports during such year exceeds the trigger quantity as specified below:

In years 13 through 34, the trigger quantity shall increase at a compounded annual growth rate of 3 per cent.

(c) For purposes of subparagraph (a), the safeguard duty for each year shall be:

(d) The United States may maintain an agricultural safeguard measure under this paragraph only until the end of the calendar year.

(e) The United States shall not apply or maintain an agricultural safeguard measure under this paragraph on a good after January 1 of year 35.

(f) This paragraph applies to the following Table 2 provisions: AG04022150, AG04039045, AG04039055, AG04041090, AG23099028 and AG23099048.

SG-US5: Country-Specific Safeguard Measure for Peru for Condensed and Evaporated Milk

8. This paragraph sets out a country-specific safeguard measure for the originating goods of Peru described in subparagraph (g). The safeguard measure is designated in the Schedule of the United States to Annex 2-D with the designation SG-US5.

(a) Notwithstanding Article 2.4 (Elimination of Customs Duties), the United States may apply an agricultural safeguard measure in the form of an additional import duty on originating goods of Peru described in subparagraph (g), provided that the conditions in subparagraphs (b) through (f) are met. The sum of any such additional import duty and any other customs duty on such good shall not exceed the least of:

(i) the base tariff rate provided in the Schedule of the United States to Annex 2-D;

(ii) the most-favoured-nation (MFN) applied rate of duty in effect on the day immediately preceding the date of entry into force of this Agreement for the United States; or

(iii) the prevailing MFN applied rate of duty.

(b) The United States may apply an agricultural safeguard measure during any calendar year on originating goods of Peru described in subparagraph (g) if the quantity of imports during such year of:

(i) such goods; and

(ii) goods imported into the United States under the United States-Peru Trade Promotion Agreement under tariff items 04029170, 04029190, 04029945, and 04029955, when combined, exceeds the trigger quantity as set out in subparagraph (f).

(c) The additional duty under subparagraph (a) shall be set according to subparagraph (h).

(d) The United States shall not apply or maintain an agricultural safeguard measure on originating goods of Peru described in subparagraph (g) on or after the date that the good is subject to duty-free treatment under the Schedule of the United States to Annex 2-D.

(e) The United States may maintain an agricultural safeguard measure under this paragraph only until the end of the calendar year.

(f) The safeguard trigger quantity in any year shall be determined by multiplying the in-quota quantity for the goods of Peru described in subparagraph (g) for that year, as set out in Appendix A to the Schedule of the United States to Annex 2-D, by 130 per cent.

(g) This paragraph applies to the following Table 2 provisions: AG04029170, AG04029190, AG04029945 and AG04029955.

(h) For purposes of subparagraph (c), the additional import duties shall be:

(i) In 2016 through 2020, less than or equal to 100 per cent of the difference between the limit provided in subparagraph (a) and the applicable tariff rate provided in the Schedule of the United States to Annex 2-D; and

(ii) In 2021 through 2024, less than or equal to 50 per cent of the difference between the limit provided in subparagraph (a) and the applicable tariff rate provided in the Schedule of the United States to Annex 2-D.

SG-US6: Country-Specific Safeguard Measure for Peru for Cheese

9. This paragraph sets out a country-specific safeguard measure for the originating goods of Peru described in subparagraph (g). The safeguard measure is designated in the Schedule of the United States to Annex 2-D with the designation SG-US6.

(a) Notwithstanding Article 2.4 (Elimination of Customs Duties), the United States may apply an agricultural safeguard measure in the form of an additional import duty on originating goods of Peru described in subparagraph (g), provided that the conditions in subparagraphs (b) through (f) are met. The sum of any such additional import duty and any other customs duty on such good shall not exceed the least of:

(i) the base tariff rate provided in the Schedule of the United States to Annex 2-D;

(ii) the most-favored-nation (MFN) applied rate of duty in effect on the day immediately preceding the date of entry into force of this Agreement for the United States; or

(iii) the prevailing MFN applied rate of duty.

(b) The United States may apply an agricultural safeguard measure during any calendar year on originating agricultural goods of Peru described in subparagraph (g) if the quantity of imports during such year of:

(i) such goods; and

(ii) goods imported into the United States under the United States-Peru Trade Promotion Agreement under tariff items 04061008, 04061018, 04061028, 04061038, 04061048, 04061058, 04061068, 04061078, 04061088, 04062028, 04062033, 04062039, 04062048, 04062053, 04062063, 04062067, 04062071, 04062075, 04062079, 04062083, 04062087, 04062091, 04063018, 04063028, 04063038, 04063048, 04063053, 04063063, 04063067, 04063071, 04063075, 04063079, 04063083, 04063087, 04063091, 04064070, 04069012, 04069018, 04069032, 04069037, 04069042, 04069048, 04069054, 04069068, 04069074, 04069078, 04069084, 04069088, 04069092, 04069094, 04069097 and 19019036,

when combined, exceeds the trigger quantity as set out in subparagraph (f).

(c) The additional duty under subparagraph (a) shall be set according to subparagraph (h).

(d) The United States shall not apply or maintain an agricultural safeguard measure on originating goods of Peru described in subparagraph (g) on or after the date that the good is subject to duty-free treatment under the Schedule of the United States to Annex 2-D.

(e) The United States may maintain an agricultural safeguard measure under this paragraph only until the end of the calendar year.

(f) The agricultural safeguard trigger quantity in any year shall be determined by multiplying the in-quota quantity for the goods of Peru described in subparagraph (g) for that year, as set out in Appendix A to Schedule of the United States to Annex 2-D, by 130 per cent.

(g) This paragraph applies to the following Table 2 provisions: AG04061008, AG04061018, AG04061028, AG04061038, AG04061048, AG04061058, AG04061068, AG04061078, AG04061088, AG04062028, AG04062033, AG04062039, AG04062048, AG04062053, AG04062063, AG04062067, AG04062071, AG04062075, AG04062079, AG04062083, AG04062087, AG04062091, AG04063018, AG04063028, AG04063038, AG04063048, AG04063053, AG04063063, AG04063067, AG04063071, AG04063075, AG04063079, AG04063083, AG04063087, AG04063091, AG04064070, AG04069012, AG04069018, AG04069032, AG04069037, AG04069042, AG04069048, AG04069054, AG04069068, AG04069074, AG04069078, AG04069084, AG04069088, AG04069092, AG04069094, AG04069097 and AG19019036.

(h) For purposes of subparagraph (c), the additional import duties shall be:

(i) In 2016 through 2020, less than or equal to 100 per cent of the difference between the limit provided in subparagraph (a) and the applicable tariff rate provided in the Schedule of the United States to Annex 2-D; and

(ii) In 2021 through 2024, less than or equal to 50 per cent of the difference between the limit provided in subparagraph (a) and the applicable tariff rate provided in the Schedule of the United States to Annex 2-D.


APPENDIX C

TARIFF DIFFERENTIALS OF THE UNITED STATES

1. For an originating good identified below in Table C-1, if the United States applies different preferential tariff treatment to other Parties for that originating good in accordance with the Schedule of the United States to Annex 2-D, the United States shall apply the rate of customs duty for the originating good of the Party:

(a) where the good is wholly obtained, either in that Party or in that Party and the United States;

(b) where the good is produced entirely, exclusively from originating materials, excluding any materials produced in another Party other than the United States;

(c) where the good is produced entirely, from originating materials, excluding any materials produced in another Party other than the United States, and from non-originating materials that have met the relevant product specific rule in the Annex 3-D (Product Specific Rules of Origin); or

(d) where the good is produced from originating materials produced in Parties other than that Party or the United States, provided that each of those materials satisfies the applicable change in tariff classification requirement set out in Table C-1.

2. If the originating good is produced in a Party from originating materials produced in Parties other than that Party or the United States and any of those materials do not satisfy the applicable change in tariff classification requirement in Table C-1, an importer may:

(a) claim the highest rate of customs duty for the originating good among the Parties where those originating materials were produced; or

(b) in accordance with paragraph 10 of Annex 2-D, claim the highest rate of customs duty applicable to all Parties for the originating good.


APPENDIX D

BETWEEN JAPAN AND THE UNITED STATES ON MOTOR VEHICLE TRADE

Article 1

1. For the purposes of this Appendix:

Appendix Party means either Japan or the United States, as the case may be; motor vehicle means any good classified under heading 87.03 or 87.04;

originating motor vehicle means any motor vehicle qualifying as originating under Chapter 3 (Rules of Origin and Origin Procedures); and

TBT Agreement means the WTO Agreement on Technical Barriers to Trade, as may be amended.

The definitions of the terms used in this Appendix contained in Annex 1 of the TBT Agreement, including the chapeau and explanatory notes of Annex 1, are incorporated into this Appendix and shall form part of this Appendix mutatis mutandis.

2. Article 2, Article 3 and Article 4 shall apply to the preparation, adoption and application of all technical regulations, standards and conformity assessment procedures of central government bodies that may affect trade in motor vehicles between the Appendix Parties, except as provided in paragraphs 4 and 5.

3. All references in this Appendix to technical regulations, standards and conformity assessment procedures shall be construed to include any amendments to them and any addition to the rules or the product coverage of those technical regulations, standards and procedures, except amendments and additions of an insignificant nature.

4. This Appendix shall not apply to technical specifications prepared by a governmental entity for its production or consumption requirements. These specifications are covered by Chapter 15 (Government Procurement).

5. This Appendix shall not apply to sanitary and phytosanitary measures. These are covered by Chapter 7 (Sanitary and Phytosanitary Measures).

6. No Party other than an Appendix Party shall have recourse to dispute settlement under Chapter 28 (Dispute Settlement) for any matter arising under this Appendix or to dispute settlement under Article 7 for any matter arising under this Agreement. No Appendix Party shall have recourse to dispute settlement under Chapter 28 (Dispute Settlement) for nullification or impairment within the meaning of Article 28.3.1(c) (Scope) for any matter arising under Article 6, Article 7 or Article 8 of this Appendix.

Article 2

1. Except in those urgent circumstances referred to in Article 2.10 and Article 5.7 of the TBT Agreement, for any technical regulation or conformity assessment procedure that would require a substantial change in motor vehicle design or technology, each Appendix Party shall provide an interval between the date of publication of the technical regulation or conformity assessment procedure and the date on which compliance with the measure becomes mandatory that is usually not less than 12 months.

2. Each Appendix Party shall ensure that its advisory committees and similar groups established by, or operated under the direction of, an agency of the central level of government to provide to it advice or recommendations by consensus that could result in regulations or other measures that would materially affect the certification, importation, sale, distribution or functioning of motor vehicles, are established and operated in a transparent manner. To that end, each Appendix Party shall ensure that, in accordance with its laws and regulations:

(a) timely notice of the formation of such advisory committees and similar groups is published;

(b) timely notice of meetings of such advisory committees and similar groups is published;

(c) meetings of such advisory committees and similar groups are open to the public;

(d) interested persons have opportunities to appear before or file statements with such advisory committees and similar groups; and

(e) detailed meeting minutes and other documents made available to or prepared by such advisory committees and similar groups are made available to the public.

3. (a) Each Appendix Party shall, no later than the date on which it first supplies information in writing to a non-governmental expert or interested person for comment, regarding a technical regulation, standard or conformity assessment procedure affecting motor vehicles that it is developing, make the same information publicly available, such as by publishing the information on an official website.

(b) Following the provision of information under subparagraph (a), the Appendix Party providing such information shall, on request of the other Appendix Party, provide additional available information with respect to the technical regulation, standard or conformity assessment procedure concerned, such as information regarding other regulatory approaches under consideration and analysis of the impact of that regulatory measure and those approaches.

4. (a) Each Appendix Party shall endeavour to periodically conduct post-implementation reviews of its significant regulations setting out technical regulations, standards or conformity assessment procedures that affect motor vehicles.

(b) For the purposes of this paragraph:

post-implementation review means an examination of the effectiveness of a technical regulation, standard or conformity assessment procedure after it has been implemented, including, as appropriate, an assessment of whether it achieves its stated objectives, the burden it imposes and its compatibility with other technical regulations, standards or conformity assessment procedures the Appendix Party has adopted.

Article 3

1. The Appendix Parties shall cooperate bilaterally, including in their activities under the Agreement concerning the Establishing of Global Technical Regulations for Wheeled Vehicles, Equipment and Parts which can be fitted and/or be used on Wheeled Vehicles (1998 Agreement), to harmonise standards for motor vehicle environmental performance and safety.

2. Each Appendix Party shall ensure that technical regulations related to motor vehicles are not prepared, adopted or applied with a view to or with the effect of creating unnecessary obstacles to international trade, to the extent provided for in Article 2.2 of the TBT Agreement. For this purpose, technical regulations related to motor vehicles shall not be more trade-restrictive than necessary to fulfil a legitimate objective, taking account of the risks non fulfilment would create. Such legitimate objectives are, inter alia: national security requirements; the prevention of deceptive practices; and protection of human health or safety, animal or plant life or health, or the environment. In assessing such risks, relevant elements of consideration are, inter alia: available scientific and technical information, related processing technology or intended end-uses of products.

3. Neither Appendix Party shall prevent or unduly delay the placing on its market of a motor vehicle product on the ground that the product incorporates a new technology or a new feature which has not yet been regulated, unless the Appendix Party finds, based on scientific or technical information, that this new technology or new feature poses a risk for human health or safety, or the environment.

4. When an Appendix Party decides to refuse the placing on its market or require the withdrawal from its market of a motor vehicle product on the ground that the product incorporates a new technology or a new feature posing a risk for human health or safety, or the environment, the Appendix Party shall immediately notify the importer of the product of its decision. The notification shall include all relevant scientific or technical information.

5. Each Appendix Party shall adopt or maintain efficient procedures for the temporary importation of motor vehicles incorporating new technologies or new features for the purposes of demonstration, display or road testing within its territory. Each Appendix Party shall facilitate the entry of such vehicles into its territory in accordance with these procedures regardless of whether they comply with otherwise applicable standards or technical regulations.

6. (a) With respect to requirements of a safety regulation under the Road Vehicle Law (Law No. 185 of 1951) of Japan (Road Vehicle Law) that the competent authority of Japan identified as of April 1, 2015, if the competent authority of Japan finds that a requirement of the U.S. FMVSS is no less stringent than the requirement under the Road Vehicle Law to which it corresponds, originating motor vehicles from the United States classified under heading 87.03 that comply with such a requirement of the U.S. FMVSS shall be deemed to comply with that requirement under the Road Vehicle Law. Such treatment shall apply unless that requirement under the Road Vehicle Law is modified and, as modified, is substantially more stringent than previously. In that event, Japan shall continue to provide such treatment for a period that is usually not less than 12 months after the date on which the requirement under the Road Vehicle Law is modified.

(b) Japan shall permit the importation and use of any motor vehicle part necessary to repair or service an originating motor vehicle from the United States classified under heading 87.03 that, at the time of the motor vehicle's initial inspection in Japan, was deemed, pursuant to subparagraph (a), to comply with a requirement under the Road Vehicle Law, provided that the part meets the same specifications of the part originally installed in the motor vehicle at the time of its initial inspection.

(c) For the purposes of this paragraph:

U.S. FMVSS means Federal Motor Vehicle Safety Standard of the United States; and

initial inspection means the inspection that motor vehicles must undergo in order to be used for transport in Japan in accordance with the Road Vehicle Law.

Article 4

1. Japan shall not adopt any requirement under the Preferential Handling Procedure that is not applied on the date of entry into force of this Agreement with respect to Japan and the United States and that increases the burden, including the complexity and cost, for importers under the Preferential Handling Procedure, except for requirements related to new technical regulations or amendments to existing technical regulations that are prepared, adopted and applied in a manner consistent with Article 3.2 after that date, or for an increase of fees and charges commensurate with the cost of services rendered under the Preferential Handling Procedure.

2. Japan shall ensure that the Preferential Handling Procedure and its relevant regulations are adopted and applied in a manner that does not preclude the eligibility of motor vehicles imported under the Preferential Handling Procedure for any financial incentive measures of central government bodies with respect to motor vehicles.

3. For the purposes of this Article:

Preferential Handling Procedure means a simplified conformity assessment procedure conducted exclusively for imported motor vehicles up to a designated number for each type, in accordance with the notification of the Minister of Land, Infrastructure, Transport and Tourism of Japan.

Article 5

To the extent that an Appendix Party maintains and applies any laws or regulations at the central level of government with respect to zoning applicable to the establishment of distribution or repair facilities for motor vehicles, it shall ensure such laws or regulations are applied in a transparent and non discriminatory manner.

Article 6

An Appendix Party may apply a transitional safeguard measure on originating motor vehicles from the other Appendix Party classified under heading 87.03 or 87.04, during the transition period only, in accordance with the provisions set out in Chapter 6 (Trade Remedies), with the following procedural modifications:

(a) In lieu of the definition of transition period provided for in Article 6.1 (Definitions), the following definition shall apply:

transition period means the period beginning on the date of entry into force of this Agreement with respect to Japan and the United States and ending on the date that is 10 years after the end of the period of the staged tariff elimination for a particular good.

(b) In lieu of Article 6.4.2 (Standards for a Transitional Safeguard Measure), the following shall apply:

Neither Appendix Party shall apply a transitional safeguard measure for a period exceeding two years, except that the period may be extended by up to two years if the competent authority of the Appendix Party that applies the measure determines, in conformity with the procedures set out in Article 6.5 (Investigation Procedures and Transparency Requirements), that the transitional safeguard measure continues to be necessary to prevent or remedy serious injury and to facilitate adjustment.

(c) Paragraphs 4 and 6 of Article 6.4 (Standards for a Transitional Safeguard Measure) shall not apply.

(d) In lieu of paragraphs 1 and 2 of Article 6.7 (Compensation), the following shall apply:

(i) an Appendix Party applying a transitional safeguard measure shall consult with the other Appendix Party in order to mutually agree on appropriate trade liberalising compensation in the form of concessions that have substantially equivalent trade effects or equivalent to the value of the additional duties expected to result from the transitional safeguard measure. The Appendix Party shall provide an opportunity for those consultations no later than 30 days after the application of the transitional safeguard measure;

(ii) if the consultations under subparagraph (d)(i) do not result in an agreement on trade liberalising compensation within 30 days after the consultations begin, the Appendix Party against whose good the transitional safeguard measure is applied may suspend the application of substantially equivalent concessions to the trade of the Appendix Party applying the transitional safeguard measure; and

(iii) the right of suspension referred to in subparagraph (d)(ii) shall not be exercised for the first 24 months during which a transitional safeguard measure is in effect, provided that the transitional safeguard measure conforms to the provisions of this Agreement.

Article 7

1. For the purposes of this Article, the definitions set out in Article 28.1 (Definitions) shall apply, mutatis mutandis.

2. With respect to any matter described in Article 28.3 (Scope) that relates to motor vehicles, an Appendix Party may initiate the dispute settlement procedures set out in this Article in lieu of the procedures provided for in Article 28.4 (Choice of Forum), Article 28.5 (Consultations), Article 28.6 (Good Offices, Conciliation and Mediation), Article 28.7 (Establishment of a Panel), Article 28.8 (Terms of Reference), Article 28.9 (Composition of Panels), Article 28.10 (Qualifications of Panellists), Article 28.11 (Roster of Panel Chairs and Party Specific Lists), Article 28.12 (Function of Panels), Article 28.13 (Rules of Procedure for Panels), Article 28.14 (Third Party Participation), Article 28.15 (Role of Experts), Article 28.16 (Suspension or Termination of Proceedings), Article 28.17 (Initial Report), Article 28.18 (Final Report), Article 28.19 (Implementation of Final Report), Article 28.20 (Non-Implementation – Compensation and Suspension of Benefits) and Article 28.21 (Compliance Review).

3. (a) An Appendix Party may request consultations with the other Appendix Party with respect to any matter described in paragraph 2. The Appendix Party making the request for consultations shall do so in writing, and shall set out the reasons for the request, including identification of the actual or proposed measure or other matter at issue and an indication of the legal basis for the complaint. The requesting Appendix Party shall circulate the request concurrently to the other Parties through the overall contact points designated under Article 27.5.1 (Contact Points).

(b) The Appendix Party to which a request for consultations is made shall, unless the Appendix Parties agree otherwise, reply in writing to the request no later than seven days after the date of its receipt of the request. That Appendix Party shall circulate its reply concurrently to the other Parties through the overall contact points and enter into consultations in good faith.

(c) Unless the Appendix Parties agree otherwise, they shall enter into consultations no later than 15 days after the date of receipt of the request.

(d) Unless the Appendix Parties agree otherwise, paragraphs 5 through 8 of Article 28.5 (Consultations) shall apply, mutatis mutandis, to the consultations under this paragraph.

4. (a) An Appendix Party that requested consultations under paragraph 3(a) may request, by means of a written notice addressed to the other Appendix Party, the establishment of a panel if the Appendix Parties fail to resolve the matter within a period of 30 days after the date of receipt of the request for consultations under paragraph 3(a).

(b) The complaining Appendix Party shall circulate the request concurrently to the other Parties through the overall contact points designated under Article 27.5.1 (Contact Points).

(c) Paragraphs 3, 4 and 7 of Article 28.7 (Establishment of a Panel) shall apply, mutatis mutandis, to the establishment of a panel. Unless the Appendix Parties agree otherwise, the panel shall be composed in a manner consistent with this Article and, subject to the time frames set out in paragraph 6, the Rules of Procedure.

5. (a) Unless the Appendix Parties agree otherwise no later than 15 days after the date of delivery of the request for the establishment of a panel, the terms of reference shall be to:

(i) examine, in the light of the relevant provisions of this Agreement, the matter referred to in the request for the establishment of a panel under paragraph 4(a); and

(ii) make findings and determinations, and any jointly requested recommendations, together with its reasons therefor, as provided for in Article 28.17.4 (Initial Report) as applied pursuant to paragraph 8.

(b) If, in its request for the establishment of a panel, the complaining Appendix Party claims that a measure nullifies or impairs benefits within the meaning of Article 28.3.1(c) (Scope), the terms of reference shall so indicate.

6. (a) A panel shall be composed of three members.

(b) Unless the Appendix Parties agree otherwise, they shall apply the following procedures to compose a panel:

(i) Within a period of 15 days after the date of delivery of the request for the establishment of a panel under paragraph

4(a), the complaining Appendix Party, on the one hand, and the responding Appendix Party, on the other, shall each appoint a panellist and notify each other of those appointments.

(ii) If the complaining Appendix Party fails to appoint a panellist within the period specified in subparagraph (b)(i), the dispute settlement proceedings shall lapse at the end of that period.

(iii) If the responding Appendix Party fails to appoint a panellist within the period specified in subparagraph (b)(i), the complaining Appendix Party shall select the panellist not yet appointed:

(A) from the responding Appendix Party's list established under Article 28.11.9 (Roster of Panel Chairs and Party Specific Lists);

(B) if the responding Appendix Party has not established a list under Article 28.11.9 (Roster of Panel Chairs and Party Specific Lists), from the roster of panel chairs established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists); or

(C) if the responding Appendix Party has not established a list under Article 28.11.9 (Roster of Panel Chairs and Party Specific Lists) and no roster of panel chairs has been established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists), by random selection from a list of three candidates, who are not nationals of the complaining Appendix Party, nominated by the complaining Appendix Party, no later than 20 days after the date of delivery of the request for the establishment of a panel under paragraph 4(a).

(iv) For appointment of the third panellist, who shall serve as chair:

(A) the Appendix Parties shall endeavour to agree on the appointment of a chair;

(B) if the Appendix Parties fail to appoint a chair under subparagraph (b)(iv)(A) within a period of 15 days after the date of delivery of the request for the establishment of the panel under paragraph 4(a), the Appendix Parties shall select the chair by random selection from the roster established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists) within a period of 20 days after the date of delivery of the request for the establishment of the panel; or

(C) if a roster has not been established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists), and subparagraphs (b)(iv)(A) and (B) cannot apply, each Appendix Party may nominate up to three candidates. The chair shall be randomly selected from those candidates that are nominated within a period of 20 days after the date of delivery of the request for the establishment of a panel under paragraph 4(a).

(D) The chair shall not be a national of either Appendix Party and any nationals of the Appendix Parties appointed to the roster established under Article 28.11 (Roster of Panel Chairs and Party Specific Lists) shall be excluded from a selection process under subparagraph (b)(iv).

(v) If a panellist selected under subparagraph (b)(iii) or (iv)(B) is unable to serve on the panel, the Appendix Parties shall meet no later than five days after the date of learning that the panellist is unavailable to select another panellist from among the remaining members of the list (in the case of subparagraph (b)(iii)), or the roster (in the case of subparagraph (b)(iv)(B)).

(vi) If a panellist appointed under this paragraph resigns or becomes unable to serve on the panel, either during the course of proceeding or when the panel is reconvened under paragraph 10(b), 13 or 17, a replacement panellist shall be appointed within 12 days in accordance with the selection procedures prescribed in this subparagraph for the appointment of the original panellist. The replacement shall have all the powers and duties of the original panellist. The work of the panel shall be suspended pending the appointment of the replacement panellist, and all timeframes set out in this Article and in the Rules of Procedure shall be extended by the amount of time that the work was suspended.

(vii) Paragraphs 4, 5 and 10 of Article 28.9 (Composition of Panels) shall apply, mutatis mutandis, to the selection procedures.

7. All panellists shall meet the requirements set out in Article 28.10.1 (Qualifications of Panellists). An individual shall not serve as a panellist for a dispute in which that person has participated under Article 28.6 (Good Offices, Conciliation, and Mediation) as applied pursuant to paragraph 8.

8. Unless the Appendix Parties agree otherwise, Article 28.4 (Choice of Forum), Article 28.6 (Good Offices, Conciliation and Mediation), Article 28.12 (Function of Panels), Article 28.15 (Role of Experts), Article 28.16 (Suspension or Termination of Proceedings), Article 28.17 (Initial Report) and Article 28.18 (Final Report) shall apply, mutatis mutandis, to panel proceedings under this Article, except that:

(a) with respect to Article 28.17.3 (Initial Report), the panel shall present an initial report to the Appendix Parties no later than 120 days after the date of the appointment of the last panellist;

(b) with respect to Article 28.17.4 (Initial Report), the panel shall also make a determination as to whether the non-conformity or the nullification or impairment, if any, has materially affected the sale, offering for sale, purchase, transportation, distribution or use of originating motor vehicles from the complaining Appendix Party;

(c) with respect to Article 28.17.7 (Initial Report), an Appendix Party may submit written comments to the panel on its initial report no later than 10 days after the presentation of the initial report or within another period as the Appendix Parties may agree; and

(d) with respect to Article 28.18.1 (Final Report), the panel shall present a final report to the Appendix Parties, including any separate opinions on matters not unanimously agreed, no later than 20 days after presentation of the initial report. After taking any steps to protect confidential information, and no later than seven days after the presentation of the final report, the Appendix Parties shall release the final report to the public.

9. Unless the Appendix Parties agree otherwise, paragraphs 1 and 2 of Article 28.19 (Implementation of Final Report) shall apply, mutatis mutandis, to the implementation of the final report.

10. (a) Unless the Appendix Parties agree otherwise, if in its final report the panel determines that:

(i) (A) the measure at issue is inconsistent with an Appendix Party's obligations in this Agreement;

(B) an Appendix Party has otherwise failed to carry out its obligations in this Agreement; or

(C) the measure at issue is causing nullification or impairment within the meaning of Article 28.3.1(c) (Scope); and

(ii) the non-conformity or the nullification or impairment that the panel has determined to exist has materially affected the sale, offering for sale, purchase, transportation, distribution or use of originating motor vehicles from the complaining Appendix Party, the complaining Appendix Party may suspend the application to the responding Appendix Party of benefits or take action in accordance with paragraphs 11 through 17.

(b) Unless the Appendix Parties agree otherwise, if in its final report the panel determines that the non-conformity or the nullification or impairment that the panel has determined to exist under subparagraph (a)(i) has not materially affected the sale, offering for sale, purchase, transportation, distribution or use of originating motor vehicles from the complaining Appendix Party, the procedures provided for in paragraphs 3 through 7 of Article 28.19 (Implementation of Final Report), Article 28.20 (Non Implementation – Compensation and Suspension of Benefits) and Article 28.21 (Compliance Review) shall apply, mutatis mutandis.

11. If a final report that contains a determination described in paragraph 10(a) is presented to the Appendix Parties under paragraph 8(d) on or after the date on which customs duties imposed by the complaining Appendix Party on originating motor vehicles from the responding Appendix Party classified under heading 87.03, Harmonized Tariff Schedule of the United States (HTSUS) 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 or HTSUS 8704.90.00 have begun to be reduced in accordance with the complaining Appendix Party's Schedule to Annex 2-D (Tariff Commitments), taking into account any delay of implementation of the period of the staged tariff elimination as a result of previous action taken pursuant to paragraph 14(a)(i), the complaining Appendix Party may increase the rate of customs duty on those originating motor vehicles:

(a) to a level not to exceed the prevailing most-favoured-nation applied rate of customs duty on those motor vehicles, for a period of up to 90 days after the release of the final report under paragraph 8(d); and

(b) thereafter, to a level not to exceed the prevailing most-favoured nation applied rate of customs duty on those motor vehicles, less 50 per cent of the difference between that rate and the rate of customs duty on those originating motor vehicles set out in the complaining Appendix Party's Schedule to Annex 2-D (Tariff Commitments), as adjusted to take into account any delay of implementation of the period of the staged tariff elimination as a result of previous action taken pursuant to paragraph 14(a)(i), provided that the complaining Appendix Party shall not suspend the application to the responding Appendix Party of benefits under this paragraph following a determination by the panel under paragraph 13.

12. (a) At any time after release of a final report that contains a determination described in paragraph 10(a), the complaining Appendix Party may provide a written notice to the responding Appendix Party that it intends to suspend benefits under paragraph 14(a)(ii) or (b), or to take action under paragraph 14(a)(i). The notice shall specify the level of benefits that the complaining Appendix Party proposes to suspend under paragraph 14(a)(ii) or (b), or the level of benefits for the purposes of taking action under paragraph 14(a)(i). The complaining Appendix Party may request that the panel be reconvened to determine the level of benefits up to which it may suspend under paragraph 14(a)(ii) or (b), or the level of benefits for the purposes of taking action under paragraph 14(a)(i), at any time after it provides a notice under this subparagraph.

(b) If the responding Appendix Party considers that the level of benefits proposed to be suspended or that has been suspended under paragraph 14(a)(ii) or (b), or the level of benefits for the purposes of taking action under paragraph 14(a)(i), is manifestly excessive, or that it has eliminated the non-conformity or the nullification or impairment that the panel has determined to exist, it may request that the panel be reconvened to consider the matter.

(c) Regardless of whether the complaining Appendix Party has provided a notice under subparagraph (a), the responding Appendix Party may request that the panel be reconvened to determine the level of benefits under paragraph 13:

(i) if the complaining Appendix Party has increased the rate of customs duty under paragraph 11; or

(ii) for the purposes of the determination of the length of time by which the complaining Appendix Party may delay implementation of the period of the staged tariff elimination under paragraph 14(a)(i).

(d) An Appendix Party shall deliver any request to reconvene the panel in writing to the other Appendix Party.

13. Unless the Appendix Parties agree otherwise, the panel shall reconvene as soon as possible after the date of delivery of the request under paragraph 12 and shall present to the Appendix Parties its determination of the level of benefits that the complaining Appendix Party may suspend no later than 90 days after it reconvenes. The panel shall determine the level of benefits that the complaining Appendix Party may suspend under paragraph 14(a)(ii) or (b), or the level of benefits for the purposes of taking action under paragraph 14(a)(i), as the sum of:

(a) the level of benefits of equivalent effect, as set out in Article 28.20.5 (Non-Implementation – Compensation and Suspension of Benefits); and

(b) the level of benefits referred to in subparagraph (a) multiplied by the ratio of the average of the total value of annual imports of originating motor vehicles from the responding Appendix Party classified under heading 87.03 into the complaining Appendix Party in the most recent four years to the average of the total value of annual imports of originating motor vehicles from the complaining Appendix Party classified under heading 87.03 into the responding Appendix Party in the most recent four years, to the extent that the sum of this amount and the level of benefits referred to in subparagraph (a) does not exceed the amount that is the sum of 3.75 per cent of the average of the total value of annual imports of originating motor vehicles from Japan classified under heading 87.03 into the United States in the most recent four years and 37.5 per cent of the average of the total value of annual imports of originating motor vehicles from Japan classified under HTSUS 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 and HTSUS 8704.90.00 into the United States in the most recent four years.

14. Following a determination by the panel under paragraph 13, the complaining Appendix Party may:

(a) (i) if a final report that contains a determination described in paragraph 10(a) is presented to the Appendix Parties under paragraph 8(d) prior to the date on which customs duties imposed by the complaining Appendix Party on originating motor vehicles from the responding Appendix Party classified under heading 87.03, HTSUS 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 or HTSUS 8704.90.00 will begin to be reduced in accordance with the complaining Appendix Party's Schedule to Annex 2-D (Tariff Commitments), taking into account any delay of implementation of the period of the staged tariff elimination as a result of previous action taken pursuant to paragraph 14(a)(i), delay implementation of the period of the staged tariff elimination25 of originating motor vehicles from the responding Appendix Party classified under heading 87.03, HTSUS 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 or HTSUS 8704.90.00, in accordance with the following:

(A) the length of time by which the complaining Appendix Party may delay implementation of the period of the staged tariff elimination shall be the product of the period of non-conformity or nullification or impairment and the level of benefits determined by the panel under paragraph 13, divided by the amount that is the sum of 3.75 per cent of the average of the total value of annual imports of originating motor vehicles from Japan classified under heading 87.03 into the United States in the most recent four years and 37.5 per cent of the average of the total value of annual imports of originating motor vehicles from Japan classified under HTSUS 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 and HTSUS 8704.90.00 into the United States in the most recent four years; and

(B) for the purposes of paragraph 14(a)(i), the period of non-conformity or nullification or impairment shall be the period beginning on the date on which the final report that contains a determination described in paragraph 10(a) is presented to the Appendix Parties under paragraph 8(d), and ending on the date on which the panel determines that the responding Appendix Party has eliminated the non-conformity or the nullification or impairment or a mutually satisfactory solution is reached, provided that, if the date on which the panel issues its determination under paragraph 13 is more than 90 days after the date on which the panel reconvenes, the number of days by which the issuance of that determination exceeded 90 days shall not be included in the period of non-conformity or nullification or impairment; or

(ii) if a final report that contains a determination described in paragraph 10(a) is presented to the Appendix Parties under paragraph 8(d) on or after the date on which customs duties imposed by the complaining Appendix Party on originating motor vehicles from the responding Appendix Party classified under heading 87.03, HTSUS 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 or HTSUS 8704.90.00 have begun to be reduced in accordance with the complaining Appendix Party's Schedule to Annex 2-D (Tariff Commitments), taking into account any delay of implementation of the period of the staged tariff elimination as a result of previous action taken pursuant to subparagraph (a)(i), unless the panel has determined that the responding Appendix Party has eliminated the non conformity or the nullification or impairment, suspend the application of benefits to the responding Appendix Party with respect to those originating motor vehicles up to the level determined by the panel under paragraph 13, provided that, to the extent that the level of benefits determined by the panel under paragraph 13(a) exceeds the level of benefits that may be suspended with respect to those originating motor vehicles, the complaining Appendix Party may increase the rate of customs duty on originating goods from the responding Appendix Party other than those originating motor vehicles to a level not exceeding the prevailing most-favoured-nation applied rate of customs duty on such goods; or

(b) if the prevailing most-favoured-nation applied rate of customs duty imposed by the complaining Appendix Party on motor vehicles classified under headings 87.03 and 87.04 is zero per cent, unless the panel has determined that the responding Appendix Party has eliminated the non-conformity or the nullification or impairment, suspend the application to the responding Appendix Party of benefits with respect to originating goods from the responding Appendix Party up to the level determined by the panel under paragraph 13; and

(i) if a final report that contains a determination described in paragraph 10(a) is presented to the Appendix Parties under paragraph 8(d) prior to the date on which customs duties imposed by the responding Appendix Party on originating motor vehicles from the complaining Appendix Party classified under heading 87.03, HTSUS 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 or HTSUS 8704.90.00 will begin to be reduced in accordance with the responding Appendix Party's Schedule to Annex 2-D (Tariff Commitments), taking into account any delay of implementation of the period of the staged tariff elimination as a result of previous action taken pursuant to subparagraph (a)(i), for a period of up to 90 days after the date on which the panel issues its determination under paragraph 13, suspend the application to the responding Appendix Party of benefits with respect to originating goods from the responding Appendix Party up to the level that is one-fourth of the annual level of benefits determined by the panel under paragraph 13; or

(ii) if a final report that contains a determination described in paragraph 10(a) is presented to the Appendix Parties under paragraph 8(d) on or after the date on which customs duties imposed by the responding Appendix Party on originating motor vehicles from the complaining Appendix Party referred to in subparagraph (b)(i) have begun to be reduced in accordance with the responding Appendix Party's Schedule to Annex 2-D (Tariff Commitments), taking into account any delay of implementation of the period of the staged tariff elimination as a result of previous action taken pursuant to subparagraph (a)(i):

(A) for a period of up to 90 days after the date on which the panel issues its determination under paragraph 13, suspend the application to the responding Appendix Party of benefits with respect to originating goods from the responding Appendix Party up to one-fourth of the amount that is the sum of 3.75 per cent of the average of the total value of annual imports of originating motor vehicles from Japan classified under heading 87.03 into the United States in the most recent four years and 37.5 per cent of the average of the total value of annual imports of originating motor vehicles from Japan classified under HTSUS 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 and HTSUS 8704.90.00 into the United States in the most recent four years; and

(B) if the date on which the panel issues its determination under paragraph 13 is more than 90 days after the date on which the panel reconvenes, beginning on the date that is 90 days after the panel issues its determination, for the number of days by which the issuance of that determination exceeded 90 days, suspend the application to the responding Appendix Party of benefits with respect to originating goods from the responding Appendix Party up to an amount that shall not exceed one-half of the amount described under subparagraph (b)(ii)(A), provided that the increased rate of customs duty applied to any good shall not exceed the prevailing most-favoured-nation applied rate of customs duty on that good.

15. Suspension of benefits under paragraph 11 or paragraph 14(a)(ii) or (b) shall be a temporary measure and only be applied until the responding Appendix Party has eliminated the non-conformity or the nullification or impairment, or until a mutually satisfactory solution is reached.

16. (a) The complaining Appendix Party shall provide a written notice to the responding Appendix Party of any increase in the rate of customs duty pursuant to paragraph 11 or paragraph 14(a)(ii) or (b) no later than the date on which the increase in the rate of customs duty takes effect.

(b) The complaining Appendix Party shall provide a written notice to the responding Appendix Party of the length of any delay of implementation of the period of the staged tariff elimination pursuant to paragraph 14(a)(i) no later than the day immediately preceding the date on which the first reduction in the rate of customs duty on originating motor vehicles referred to in that paragraph would have otherwise occurred.

17. (a) Without prejudice to the procedures in paragraphs 11 through 14, if the responding Appendix Party considers that it has eliminated the non-conformity or the nullification or impairment found by the panel, it may refer the matter to the panel by providing a written notice to the complaining Appendix Party. The panel shall issue its report on the matter no later than 90 days after the responding Appendix Party provides the written notice.

(b) If the panel determines that the responding Appendix Party has eliminated the non-conformity or the nullification or impairment, the complaining Appendix Party shall promptly reinstate any benefits suspended under paragraph 11 or paragraph 14(a)(ii) or (b).

18. The procedures set out in this Article shall apply beginning on January 1 of the second year after the date of entry into force of this Agreement with respect to Japan and the United States and ending on the date that is five years after the date on which customs duties imposed by the United States on originating motor vehicles from Japan classified under heading 87.03, HTSUS 8704.21.00, HTSUS 8704.22.50, HTSUS 8704.23.00, HTSUS 8704.31.00, HTSUS 8704.32.00 and HTSUS 8704.90.00 have been eliminated in accordance with the United States Schedule to Annex 2-D (Tariff Commitments), taking into account any delay of implementation of the period of the staged tariff elimination as a result of previous action taken pursuant to paragraph 14(a)(i), provided that the procedures shall apply to any dispute for which the final report of the panel under paragraph 8(d) was presented prior to that date.

19. The Appendix Parties shall review, on request of either Appendix Party, the operation and effectiveness of this Article five years after the date of entry into force of this Agreement with respect to Japan and the United States, and at such interval as the Appendix Parties decide thereafter.

Article 8

1. An Appendix Party may request in writing to initiate a process for consultations with the other Appendix Party with respect to any non-tariff measure that relates to motor vehicles that the other Appendix Party is considering proposing or has proposed, regardless of whether the other Appendix Party has published the non-tariff measure for comment.

2. The process for consultations shall take place no later than 10 days after the date of receipt of a request under paragraph 1, unless the Appendix Parties agree otherwise. The Appendix Party to which such a request is made shall afford the requesting Appendix Party an opportunity to raise issues and to make inquiries, provide the requesting Appendix Party with information to the extent possible, and hear the views of the requesting Appendix Party on the non-tariff measure referred to in paragraph 1.

3. If a request under paragraph 1 concerns a proposed non-tariff measure that is open for comment, the Appendix Party to which the request is made shall refrain from implementing the proposed non-tariff measure during the comment period, except where urgent problems of safety, health, environmental protection or national security arise.

4. If a non-tariff measure as to which a request has been made under paragraph 1 is adopted, and the requesting Appendix Party considers that, as described in Article 28.3.1(b) (Scope), the measure is inconsistent with an obligation of this Agreement, or that the measure nullifies or impairs benefits within the meaning of Article 28.3.1(c) (Scope), the requesting Appendix Party may so notify the other Appendix Party in writing. The notification shall include identification of the measure at issue and an indication of the legal basis for the complaint. The Appendix Party that made the notification may request the establishment of a panel pursuant to Article 7.4 at any time after the date that is 14 days after the date of receipt of the notification, provided that, on request of either Appendix Party, the Appendix Parties shall enter into consultations with respect to the matter no later than 14 days after the date of receipt of the notification.

5. If the Appendix Parties hold consultations under paragraph 4, either Appendix Party may request additional consultations no later than 14 days after the date of receipt of the notification under paragraph 4. If such a request is made, the Appendix Parties shall hold additional consultations promptly thereafter. In that event, the Appendix Party that made the notification may request the establishment of a panel pursuant to Article 7.4 at any time after the date that is 30 days after the date of receipt of the notification.

6. Paragraphs 5 through 8 of Article 28.5 (Consultations) shall apply, mutatis mutandis,30 to consultations under paragraphs 4 and 5.

Article 9

1. The Appendix Parties hereby establish a special bilateral Committee on Motor Vehicles (Committee), composed of representatives of the relevant authorities of each Appendix Party. The Committee shall:

(a) monitor implementation of the obligations in this Agreement with respect to motor vehicles;

(b) consult to resolve issues affecting trade and investment between the Appendix Parties that an Appendix Party raises with respect to the development and implementation of measures relating to motor vehicles and motor vehicle parts;

(c) exchange information on post-implementation reviews described in Article 2.4;

(d) facilitate increased cooperation with respect to emerging issues, including the manufacture, importation, sale and operation of motor vehicles using alternative fuels, and cooperation between the Appendix Parties with respect to issues concerning other markets;

(e) monitor bilateral, regional and global market developments and trends in trade, investment, production, sales and distribution with respect to motor vehicles and motor vehicle parts;

(f) provide opportunities for input from interested persons of the Appendix Parties on matters relevant to the Committee's work, as the Appendix Parties may agree; and

(g) address other issues, if the Appendix Parties agree.

2. The Committee shall meet on request of either Appendix Party and, unless the Appendix Parties decide otherwise, no less than once a year. Meetings shall take place in such locations and through such means as the Appendix Parties decide.


APPENDIX E

UNITED STATES – VIET NAM EARNED IMPORT ALLOWANCE PROGRAMME

1. The United States shall grant duty-free treatment to a covered good that:

(a) is cut and sewn or otherwise assembled in Viet Nam and is made from U.S. covered fabric and qualifies for preferential tariff treatment under this Agreement; or

(b) is cut and sewn or otherwise assembled in Viet Nam and made from covered fabric that is originating under this Agreement or of any other origin, but otherwise qualifies for preferential tariff treatment under this Agreement, subject to paragraph 9.

2. For each square metre equivalent of U.S. covered fabric imported to Viet Nam from the United States, the United States shall issue one U.S. fabric credit and one matching fabric credit.

3. As a condition of providing duty-free treatment under paragraph 1(a), the United States shall require the importer to demonstrate that the exporter or producer of the covered good has U.S. fabric credits equal to or greater than the total square metre equivalents of U.S. covered fabric in the covered good.

4. As a condition of providing duty-free treatment under paragraph 1(b), the United States shall require the importer to demonstrate that the exporter or producer of the covered good has matching fabric credits equal to or greater than 75 per cent of the total square metre equivalents of fabric in the covered good if it is classified in subheading 6204.62.20 or 6204.62.40, or 130 per cent of the total square metre equivalents of fabric in the covered good if it is classified in subheading 6203.42.20 or 6203.42.40.

5. For the purposes of determining the quantity of square metre equivalents under paragraphs 2 and 3, the conversion factors listed in "Correlation: U.S. Textile and Apparel Industry Category System with the Harmonized Tariff Schedule of the United States of America, 2008", or its successor publications, apply.

6. For the purposes of this Appendix:

covered fabric means woven fabric of cotton that is suitable for use in the manufacture of trousers, bib and brace overalls, breeches or shorts;

U.S. covered fabric means covered fabric that is wholly formed and finished in the United States of yarns wholly formed and finished in the United States classified in Chapter 52 of the Harmonised System, and so certified by the roducer of the fabric;

covered good means a good classified in HS 6203.42.20, 6203.42.40, 6204.62.20 or 6204.62.40.

U.S. fabric credit means a credit that may be used to import a covered good of U.S. fabric described under paragraph 1(a); and

matching fabric credit means a credit that may be used to import a covered good described under paragraph 1(b).

7. The United States shall establish a programme to provide duty-free treatment to covered goods, including to register eligible entities, issue credits and maintain a record of credits used, and shall publish procedures for operation of the programme. The programme shall include an online account system. The programme shall allow for the use of a credit for import of a covered good by a different exporter or producer than the one who earned the credit.

8. The United States shall apply duty-free treatment under this Appendix no later than the date of publication of procedures for the programme or 180 days after the date of entry into force of this Agreement for the United States and Viet Nam, whichever is later.

9. Preferential treatment under paragraph 1(b) shall be provided to imports of covered goods classified in subheading 6203.42.20 or 6203.42.40 in an amount not to exceed:

10. Credits of any type not used in a year will not expire and may be used in any subsequent year while this Appendix is in effect.


Vietnam

ANNEX 2-D

TARIFF SCHEDULE OF VIET NAM GENERAL NOTES

1. The provisions of this Schedule are generally expressed in terms of Viet Nam's Export and Import Classification Nomenclature (EICN), and the interpretation of the provisions of this Schedule, including the product coverage of subheadings of this Schedule, shall be governed by the General Notes, Section Notes and Chapter Notes of the EICN. To the extent that provisions of this Schedule are identical to the corresponding provisions of the EICN, the provisions of this Schedule shall have the same meaning as the corresponding provisions of the EICN.

2. Except as otherwise provided in this Schedule, the base rates of duty set out in this Schedule reflect Viet Nam's Most-Favoured-Nation (MFN) rates of duty in effect on January 1, 2010. For items identified with an asterisk (*), the applicable base rates of duty are those set forth in this Schedule.

3. In this Schedule, rates of duty expressed in monetary units shall be rounded down to the nearest hundredth of a US dollar or one Viet Nam Dong.

4. The following staging categories shall apply to the elimination or reduction of customs duties by Viet Nam pursuant to Article 2.4.2 (Elimination of Customs Duties):

(a) customs duties on originating goods provided for in the items in staging category EIF shall be eliminated entirely, and these goods shall be duty-free on the date of entry into force of this Agreement for Viet Nam;

(b) customs duties on originating goods provided for in the items in staging category B2 shall be eliminated in two annual stages, and these goods shall be duty-free effective January 1 of year 2;

(c) customs duties on originating goods provided for in the items in staging category B3 shall be eliminated in three annual stages, and these goods shall be duty-free effective January 1 of year 3;

(d) customs duties on originating goods provided for in the items in staging category B4 shall be eliminated in four annual stages, and these goods shall be duty-free effective January 1 of year 4;

(e) customs duties on originating goods provided for in the items in staging category B5 shall be eliminated in five annual stages, and these goods shall be duty-free effective January 1 of year 5;

(f) customs duties on originating goods provided for in the items in staging category B6 shall be eliminated in six annual stages, and these goods shall be duty-free effective January 1 of year 6;

(g) customs duties on originating goods provided for in the items in staging category B7 shall be eliminated in seven annual stages, and these goods shall be duty-free effective January 1 of year 7;

(h) customs duties on originating goods provided for in the items in staging category B8 shall be eliminated in eight annual stages, and these goods shall be duty-free effective January 1 of year 8;

(i) customs duties on originating goods provided for in the items in staging category B10 shall be eliminated in 10 annual stages, and these goods shall be duty-free effective January 1 of year 10;

(j) customs duties on originating goods provided for in the items in staging category B11 shall be eliminated in 11 annual stages, and these goods shall be duty-free effective January 1 of year 11;

(k) customs duties on originating goods provided for in the items in staging category B12 shall be eliminated in 12 annual stages, and these goods shall be duty-free effective January 1 of year 12;

(l) customs duties on originating goods provided for in the items in staging category B13 shall be eliminated in 13 annual stages, and these goods shall be duty-free effective January 1 of year 13;

(m) customs duties on originating goods provided for in the items in staging category B16 shall be eliminated in 16 annual stages, and these goods shall be duty-free effective January 1 of year 16;

(n) customs duties on originating goods provided for in the items in staging category VN4-A shall be at 12 per cent ad valorem through December 31 of year 2, shall be reduced to 6 per cent ad valorem on January 1 of year 3, and these goods shall be duty-free effective January 1 of year 4;

(o) customs duties on originating goods provided for in the items in staging category VN7-A shall be at 19 per cent ad valorem through December 31 of year 2, shall be reduced to 16 per cent ad valorem on January 1 of year 3, to 12 per cent ad valorem on January 1 of year 4, to 8 per cent ad valorem on January 1 of year 5 and to 4 per cent ad valorem on January 1 of year 6, and these goods shall be duty-free effective January 1 of year 7;

(p) customs duties on originating goods provided for in the items in staging category VN8-A shall remain at the base rate through December 31 of year 7, and these goods shall be duty-free effective January 1 of year 8;

(q) customs duties on originating goods provided for in the items in staging category VN8-B shall be at 9 per cent ad valorem through December 31 of year 3, shall be reduced to 7 per cent ad valorem on January 1 of year 4, to 5 per cent ad valorem on January 1 of year 5, to 4 per cent ad valorem on January 1 of year 6 and to 2 per cent ad valorem on January 1 of year 7, and these goods shall be duty-free effective January 1 of year 8;

(r) customs duties on originating goods provided for in the items in staging category VN10-A shall be at 52 per cent ad valorem through December 31 of year 4, shall be reduced to 45 per cent ad valorem on January 1 of year 5, to 36 per cent ad valorem on January 1 of year 6, to 30 per cent ad valorem on January 1 of year 7, to 25 per cent ad valorem on January 1 of year 8 and to 20 per cent ad valorem on January 1 of year 9, and these goods shall be duty-free effective January 1 of year 10;

(s) If this Agreement enters into force for Viet Nam in 2016, customs duties on originating goods provided for in the items in staging category VN11-A shall remain at the base rate through December 31, 2020. On January 1, 2021, these duties shall be reduced to 7 per cent ad valorem and remain at that rate through December 31, 2026. These goods shall be duty-free effective January 1, 2027. If this Agreement does not enter into force for Viet Nam in 2016 then customs duties on originating goods provided for in the items in staging category VN11-A shall remain at the base rate through December 31 of year 4. These duties shall be reduced to 7 per cent ad valorem on January 1 of year 5 and remain at that rate through December 31 of year 10, and these goods shall be duty-free effective January 1 of year 11;

(t) If this Agreement enters into force for Viet Nam in 2016, customs duties on originating goods provided for in the items in staging category VN11-B shall remain at the base rate through December 31, 2020. On January 1, 2021, these duties shall be reduced to 8 per cent ad valorem and remain at that rate through December 31, 2022. On January 1, 2023, these duties shall be reduced to 7 per cent ad valorem and remain at that rate through December 31, 2026. These goods shall be duty-free effective January 1, 2027. If this Agreement does not enter into force for Viet Nam in 2016 then customs duties on originating goods provided for in the items in staging category VN11-B shall remain at the base rate through December 31 of year 4. These duties shall be reduced to 8 per cent ad valorem on January 1 of year 5 and to 7 per cent ad valorem on January 1 of year 7, and they shall remain at that rate through December 31 of year 10. These goods shall be duty-free effective January 1 of year 11;

(u) If this Agreement enters into force for Viet Nam in 2016, customs duties on originating goods provided for in the items in staging category VN11-C shall remain at the base rate through December 31, 2020. On January 1, 2021, these duties shall be reduced to 15 per cent ad valorem. On January 1, 2022, these duties shall be reduced to 10 per cent ad valorem and remain at that rate through December 31, 2026. These goods shall be duty-free effective January 1, 2027. If this Agreement does not enter into force for Viet Nam in 2016 then customs duties on originating goods provided for in the items in staging category VN11-C shall remain at the base rate through December 31 of year 4. These duties shall be reduced to 15 per cent ad valorem on January 1 of year 5, to 10 per cent ad valorem on January 1 of year 6, and to 7 per cent ad valorem on January 1 of year 7, and they shall remain at that rate through December 31 of year 10. These goods shall be duty-free effective January 1 of year 11;

(v) If this Agreement enters into force for Viet Nam in 2016, customs duties on originating goods provided for in the items in staging category VN11-D shall remain at the base rate through December 31, 2019. On January 1, 2020, such duties shall be reduced to 7 per cent ad valorem and remain at that rate through December 31, 2026. Such goods shall be duty-free effective January 1, 2027. If this Agreement does not enter into force for Viet Nam in 2016 then customs duties on originating goods provided for in the items in staging category VN11-D shall remain at the base rate through December 31 of year 3 and shall be reduced to 7 per cent ad valorem on January 1 of year 4, and they shall remain at that rate through December 31 of year 10. These goods shall be duty-free effective January 1 of year 11;

(w) If this Agreement enters into force for Viet Nam in 2016, customs duties on originating goods provided for in the items in staging category VN11-E shall remain at the base rate through December 31, 2022. On January 1, 2023, these duties shall be reduced to 7 per cent ad valorem and remain at that rate through December 31, 2026. These goods shall be duty-free effective January 1, 2027. If this Agreement does not enter into force for Viet Nam in 2016 then customs duties on originating goods provided for in the items in staging category VN11-E shall remain at the base rate through December 31 of year 6, shall be reduced to 7 per cent ad valorem on January 1 of year 7, and they shall remain at that rate through December 31 of year 10. These goods shall be duty-free effective January 1 of year 11;

(x) If this Agreement enters into force for Viet Nam in 2016, customs duties on originating goods provided for in the items in staging category VN11-F shall remain at the base rate through December 31, 2026, and these goods shall be duty-free effective January 1, 2027. If this Agreement does not enter into force for Viet Nam in 2016 then customs duties on originating goods provided for in the items in staging category VN11-F shall remain at the base rate through December 31 of year 10, and these goods shall be duty free effective January 1 of year 11;

(y) customs duties on originating goods provided for in the items in staging category VN11-G shall be at 44 per cent ad valorem on the date of entry into force of this Agreement for Viet Nam and shall be reduced to 40 per cent ad valorem on January 1 of year 2, to 35 per cent ad valorem on January 1 of year 4, to 30 per cent ad valorem on January 1 of year 6, to 25 per cent ad valorem on January 1 of year 7, to 20 per cent ad valorem on January 1 of year 8, to 15 per cent ad valorem on January 1 of year 9 and to 10 per cent ad valorem on January 1 of year 10, and these goods shall be duty-free effective January 1 of year 11;

(z) customs duties on originating goods provided for in the items in staging category VN11-H shall be at 34 per cent ad valorem on the date of entry into force of this Agreement for Viet Nam, shall be reduced to 33 per cent ad valorem on January 1 of year 2, to 32 per cent ad valorem on January 1 of year 3, to 30 per cent ad valorem on January 1 of year 4, to 29 per cent ad valorem on January 1 of year 5, to 25 per cent ad valorem on January 1 of year 6, to 22 per cent ad valorem on January 1 of year 7, to 18 per cent ad valorem on January 1 of year 8, to 15 per cent ad valorem on January 1 of year 9 and to 11 per cent ad valorem on January 1 of year 10, and these goods shall be duty-free effective January 1 of year 11;

(aa) customs duties on originating goods provided for in the items in staging category VN11-I shall be at 45 per cent ad valorem on the date of entry into force of this Agreement for Viet Nam, shall be reduced to 41 per cent ad valorem on January 1 of year 2, to 36 per cent ad valorem on January 1 of year 3, to 32 per cent ad valorem on January 1 of year 4, to 27 per cent ad valorem on January 1 of year 5, to 23 per cent ad valorem on January 1 of year 6, to 22 per cent ad valorem on January 1 of year 7, to 20 per cent ad valorem on January 1 of year 8, to 15 per cent ad valorem on January 1 of year 9, to 10 per cent ad valorem on January 1 of year 10, and these goods shall be duty-free effective January 1 of year 11;

(bb) customs duties on originating goods provided for in the items in staging category VN12-A shall be at 54 per cent ad valorem on the date of entry into force of this Agreement for Viet Nam, shall be reduced to 49 per cent ad valorem on January 1 of year 2, to 44 per cent ad valorem on January 1 of year 3, to 39 per cent ad valorem on January 1 of year 4, to 35 per cent ad valorem on January 1 of year 5, to 30 per cent ad valorem on January 1 of year 6, to 25 per cent ad valorem on January 1 of year 7, to 20 per cent ad valorem on January 1 of year 8, to 15 per cent ad valorem on January 1 of year 9, to 10 per cent ad valorem on January 1 of year 10 and to 5 per cent ad valorem on January 1 of year 11, and these goods shall be duty-free effective January 1 of year 12;

(cc) customs duties on originating goods provided for in the items in staging category VN12-B shall be at 44 per cent ad valorem on the date of entry into force of this Agreement for Viet Nam, shall be reduced to 40 per cent ad valorem on January 1 of year 2 and remain at that rate through December 31 of year 3, be reduced to 35 per cent ad valorem on January 1 of year 4 and remain at that rate through December 31 of year 5, and be reduced to 30 per cent ad valorem on January 1 of year 6, to 25 per cent ad valorem on January 1 of year 7, to 20 per cent ad valorem on January 1 of year 8, to 15 per cent ad valorem on January 1 of year 9, to 10 per cent ad valorem on January 1 of year 10 and to 5 per cent ad valorem on January 1 of year 11. These goods shall be duty-free effective January 1 of year 12;

(dd) customs duties on originating goods provided for in the items in staging category VN13-A shall remain at the base rate through December 31 of year 3. Beginning January 1 of year 4, these duties shall be eliminated in 10 annual stages, and these goods shall be duty-free effective January 1 of year 13;

(ee) customs duties on originating goods provided for in the items in staging category VN13-B shall remain at the base rate through December 31 of year 2. Beginning January 1 of year 3, these duties shall be eliminated in 11 annual stages, and these goods shall be duty-free effective January 1 of year 13;

(ff) customs duties on originating goods provided for in the items in staging category VN13-C shall remain at the base rate through December 31 of year 1. Beginning January 1 of year 2, these duties shall be eliminated in 12 annual stages, and these goods shall be duty-free effective January 1 of year 13;

(gg) customs duties on originating goods provided for in the items in staging category VN13-D shall remain at the base rate through December 31 of year 4. Beginning January 1 of year 5, these duties shall be eliminated in nine annual stages, and these goods shall be duty-free effective January 1 of year 13;

(hh) customs duties on originating goods provided for in the items in staging category VN13-E shall remain at the base rate through December 31 of year 5. Beginning January 1 of year 6, these duties shall be eliminated in eight annual stages, and these goods shall be duty-free effective January 1 of year 13;

(ii) customs duties on originating goods provided for in the items in staging category VN16-A shall be reduced by 6.25 per cent of the base rate in each of four annual stages. These duties shall remain at the rate as of January 1 of year 4 through December 31 of year 15. These goods shall be duty-free effective January 1 of year 16;

(jj) customs duties on originating goods provided for in the items in staging category VN21-A shall remain at the base rate through December 31 of year 20, and these goods shall be duty-free effective January 1 of year 21;

(kk) customs duties on originating goods provided for in the items in staging category TRQ (TRQ-VN1, TRQ-VN2 and TRQ-VN3) shall be governed by the terms of the TRQ applicable to that tariff item, as outlined in Appendix A (Tariff Rate Quotas of Viet Nam) to Viet Nam's Schedule to Annex 2-D; and (ll) customs duties on originating goods provided for in the items in staging category VN22 shall remain at the base rate.

5. The annual stages referred to in paragraph 4 for the elimination or reduction of customs duties shall be equal, annual stages, except:

(a) as provided in paragraphs 3(b)(i), 4(a)(ii) and 4(b)(ii) in Section A of this Annex; or

(b) as otherwise provided in paragraph 4.

6. Tariff lines with "CKD" indicated in the "Remarks" column are no longer valid.


TARIFF SCHEDULE OF VIET NAM (HS 2012)

APPENDIX A

TARIFF RATE QUOTAS OF VIET NAM

1. This Appendix sets out modifications to the Harmonized Schedule of Viet Nam (HSV) that reflect the tariff rate quotas (TRQs) that Viet Nam shall apply to certain originating goods under this Agreement. In particular, originating goods of the Parties included under this Appendix shall be subject to the rates of duty set out in this Appendix in lieu of the rates of duty specified in Chapters 1 through 97 of the HSV. Notwithstanding any other provision of the HSV, originating goods of the Parties in the quantities described in this Appendix shall be permitted entry into the territory of Viet Nam as provided in this Appendix. Furthermore, any quantity of originating goods imported from a Party under a TRQ provided for in this Appendix shall not be counted toward the in-quota quantity of any TRQ provided for such goods under Viet Nam's WTO tariff schedule or any other trade agreement.

2. The product or products covered by each TRQ set out below are informally identified in the title to the paragraph setting out the TRQ. These titles are included solely to assist readers in understanding this Appendix and shall not alter or supersede the coverage for each TRQ established through identification of covered codes of the HSV.

3. Each TRQ set out below shall apply to an aggregate quantity of originating goods.

ANNEX 2-D – APPENDIX A – VIET NAM – 1

4. TRQ-VN1: Used Vehicles with an Engine Capacity Less Than or Equal to 3000 Cubic Centimetres

(a) The TRQ described in this paragraph is designated in the Schedule of Viet Nam to Annex 2-D (Tariff Commitments) with the designation "TRQ-VN1".

(b) The aggregate quantity of originating goods described in subparagraph (f) that shall be permitted to enter Viet Nam in each year subject to duties determined in accordance with staging category VN16-A shall be:

Starting in year 16, the quantity shall remain at 75 vehicles per year.

(c) Viet Nam shall administer this TRQ and allocate the in-quota quantity through an annual auction, which shall take place in the first quarter of each year. Viet Nam shall be permitted to retain, in addition to duties determined in accordance with staging category VN16-A, the amount of each successful bid in the auction.

(d) Viet Nam shall administer the auction referred to in subparagraph (c) in accordance with all commitments set out elsewhere in this Agreement and with the following procedures:

(i) The auction, and the procedures for submitting a bid, shall be announced on an official website of a governmental authority of Viet Nam at least 30 days prior to the auction.

(ii) Any entity registered as a trader in accordance with Viet Nam's laws shall be eligible to receive a quota allocation through the auction.

(iii) Viet Nam shall not require any minimum bid to participate in or receive a quota allocation through the auction.

(iv) Viet Nam shall maintain transparent procedures for the auction, and shall allocate the quota to the person or persons submitting the highest valid bids.

(v) Within two weeks of the auction, Viet Nam shall publish on an official government website the names of all bidders receiving an allocation, the quantity allocated to each, and the price paid by the bidder for the allocation.

(e) Duties on goods entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be applied at the MFN rate.

(f) Subparagraphs (a) through (e) apply to used goods less than or equal to five years old having an engine capacity less than or equal to 3000 cubic centimetres provided for in the following HSV headings: 87.02, 87.03 and 87.04.

5. TRQ-VN2: Used Vehicles with an Engine Capacity in Excess of 3000 Cubic Centimetres

(a) The TRQ described in this paragraph is designated in the Schedule of Viet Nam to Annex 2-D (Tariff Commitments) with the designation "TRQ-VN2".

(b) The aggregate quantity of originating goods described in subparagraph (f) that shall be permitted to enter Viet Nam in each year subject to duties determined in accordance with staging category VN16-A shall be:

Starting in year 16, the quantity shall remain at 75 vehicles per year.

(c) Viet Nam shall administer this TRQ and allocate the in-quota quantity through an annual auction, which shall take place in the first quarter of each year. Viet Nam shall be permitted to retain, in addition to duties determined in accordance with staging category VN16-A, the amount of each successful bid in the auction.

(d) Viet Nam shall administer the auction referred to in subparagraph (c) in accordance with all commitments set out elsewhere in this Agreement and with the following procedures:

(i) The auction, and the procedures for submitting a bid, shall be announced on an official website of a governmental authority of Viet Nam at least 30 days prior to the auction.

(ii) Any entity registered as a trader in accordance with Viet Nam's laws shall be eligible to receive a quota allocation through the auction.

(iii) Viet Nam shall not require any minimum bid to participate in or receive a quota allocation through the auction.

(iv) Viet Nam shall maintain transparent procedures for the auction, and shall allocate the quota to the person or persons submitting the highest valid bids.

(v) Within two weeks of the auction, Viet Nam shall publish on an official government website the names of all bidders receiving an allocation, the quantity allocated to each, and the price paid by the bidder for the allocation.

(e) Duties on goods entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be applied at the MFN rate.

(f) Subparagraphs (a) through (e) apply to used goods less than or equal to five years old having an engine capacity in excess of 3000 cubic centimetres provided for in the following HSV headings: 87.02, 87.03 and 87.04.

6. TRQ-VN3: Unmanufactured Tobacco; Tobacco Refuse

(a) The TRQ described in this paragraph is designated in the Schedule of Viet Nam to Annex 2-D (Tariff Commitments) with the designation "TRQ-VN3".

(b) The aggregate quantity of originating goods described in subparagraph (f) that shall be permitted to enter Viet Nam in each year subject to duties determined in accordance with staging category B11 shall be:

Starting in year 21, the quantity shall remain unlimited each year.

(c) Viet Nam shall administer this TRQ and allocate the in-quota quantity through state trading enterprises.

(d) Viet Nam shall administer allocation method of the state trading enterprises referred to in subparagraph (c) in accordance with all commitments set out in this Agreement.

(e) Duties on goods entered in aggregate quantities in excess of the quantities listed in subparagraph (b) shall be determined in accordance with staging category VN21-A.

(f) Subparagraphs (a) through (e) apply to goods classified in the following HSV heading: 24.01.


CHAPTER 3

RULES OF ORIGIN AND ORIGIN PROCEDURES

Section A: Rules of Origin

Article 3.1: Definitions

For the purposes of this Chapter:

aquaculture means the farming of aquatic organisms, including fish, molluscs, crustaceans, other aquatic invertebrates and aquatic plants from seed stock such as eggs, fry, fingerlings or larvae, by intervention in the rearing or growth processes to enhance production such as regular stocking, feeding or protection from predators;

fungible goods or materials means goods or materials that are interchangeable for commercial purposes and whose properties are essentially identical;

Generally Accepted Accounting Principles means those principles recognised by consensus or with substantial authoritative support in the territory of a Party with respect to the recording of revenues, expenses, costs, assets and liabilities; the disclosure of information; and the preparation of financial statements. These principles may encompass broad guidelines for general application, as well as detailed standards, practices and procedures;

good means any merchandise, product, article or material;

indirect material means a material used in the production, testing or inspection of a good but not physically incorporated into the good; or a material used in the maintenance of buildings or the operation of equipment, associated with the production of a good, including:

(a) fuel, energy, catalysts and solvents;

(b) equipment, devices and supplies used to test or inspect the good;

(c) gloves, glasses, footwear, clothing, safety equipment and supplies;

(d) tools, dies and moulds;

(e) spare parts and materials used in the maintenance of equipment and buildings;

(f) lubricants, greases, compounding materials and other materials used in production or used to operate equipment and buildings; and

(g) any other material that is not incorporated into the good but the use of which in the production of the good can reasonably be demonstrated to be a part of that production;

material means a good that is used in the production of another good;

non-originating good or non-originating material means a good or material that does not qualify as originating in accordance with this Chapter;

originating good or originating material means a good or material that qualifies as originating in accordance with this Chapter;

packing materials and containers for shipment means goods used to protect another good during its transportation, but does not include the packaging materials or containers in which a good is packaged for retail sale;

producer means a person who engages in the production of a good;

production means operations including growing, cultivating, raising, mining, harvesting, fishing, trapping, hunting, capturing, collecting, breeding, extracting, aquaculture, gathering, manufacturing, processing or assembling a good;

transaction value means the price actually paid or payable for the good when sold for export or other value determined in accordance with the Customs Valuation Agreement; and

value of the good means the transaction value of the good excluding any costs incurred in the international shipment of the good.

Article 3.2: Originating Goods

Except as otherwise provided in this Chapter, each Party shall provide that a good is originating if it is:

(a) wholly obtained or produced entirely in the territory of one or more of the Parties as established in Article 3.3 (Wholly Obtained or Produced Goods);

(b) produced entirely in the territory of one or more of the Parties, exclusively from originating materials; or

(c) produced entirely in the territory of one or more of the Parties using non-originating materials provided the good satisfies all applicable requirements of Annex 3-D (Product-Specific Rules of Origin), and the good satisfies all other applicable requirements of this Chapter.

Article 3.3: Wholly Obtained or Produced Goods

Each Party shall provide that for the purposes of Article 3.2 (Originating Goods), a good is wholly obtained or produced entirely in the territory of one or more of the Parties if it is:

(a) a plant or plant good, grown, cultivated, harvested, picked or gathered there;

(b) a live animal born and raised there;

(c) a good obtained from a live animal there;

(d) an animal obtained by hunting, trapping, fishing, gathering or capturing there;

(e) a good obtained from aquaculture there;

(f) a mineral or other naturally occurring substance, not included in subparagraphs (a) through (e), extracted or taken from there;

(g) fish, shellfish and other marine life taken from the sea, seabed or subsoil outside the territories of the Parties and, in accordance with international law, outside the territorial sea of non-Partie by vessels that are registered, listed or recorded with a Party and entitled to fly the flag of that Party;

(h) a good produced from goods referred to in subparagraph (g) on board a factory ship that is registered, listed or recorded with a Party and entitled to fly the flag of that Party;

(i) a good other than fish, shellfish and other marine life taken by a Party or a person of a Party from the seabed or subsoil outside the territories of the Parties, and beyond areas over which non-Parties exercise jurisdiction provided that Party or person of that Party has the right to exploit that seabed or subsoil in accordance with international law;

(j) a good that is:

(i) waste or scrap derived from production there; or

(ii) waste or scrap derived from used goods collected there, provided that those goods are fit only for the recovery of raw materials; and

(k) a good produced there, exclusively from goods referred to in subparagraphs (a) through (j), or from their derivatives.

Article 3.4: Treatment of Recovered Materials Used in Production of a Remanufactured Good

1. Each Party shall provide that a recovered material derived in the territory of one or more of the Parties is treated as originating when it is used in the production of, and incorporated into, a remanufactured good.

2. For greater certainty:

(a) a remanufactured good is originating only if it satisfies the applicable requirements of Article 3.2 (Originating Goods); and

(b) a recovered material that is not used or incorporated in the production of a remanufactured good is originating only if it satisfies the applicable requirements of Article 3.2 (Originating Goods).

Article 3.5: Regional Value Content

1. Each Party shall provide that a regional value content requirement specified in this Chapter, including related Annexes, to determine whether a good is originating, is calculated as follows:

(a) Focused Value Method: Based on the Value of Specified Non Originating Materials

(b) Build-down Method: Based on the Value of Non-Originating Materials

(c) Build-up Method: Based on the Value of Originating Materials

where:

RVC is the regional value content of a good, expressed as a percentage;

VNM is the value of non-originating materials, including materials of undetermined origin, used in the production of the good;

NC is the net cost of the good determined in accordance with Article 3.9 (Net Cost);

FVNM is the value of non-originating materials, including materials of undetermined origin, specified in the applicable product-specific-rule (PSR) in Annex 3-D (Product-Specific Rules of Origin) and used in the production of the good. For greater certainty, non-originating materials that are not specified in the applicable PSR in Annex 3-D (Product-Specific Rules of Origin) are not taken into account for the purpose of determining FVNM; and

VOM is the value of originating materials used in the production of the good in the territory of one or more of the Parties.

2. Each Party shall provide that all costs considered for the calculation of regional value content are recorded and maintained in conformity with the Generally Accepted Accounting Principles applicable in the territory of a Party where the good is produced.

Article 3.6: Materials Used in Production

1. Each Party shall provide that if a non-originating material undergoes further production such that it satisfies the requirements of this Chapter, the material is treated as originating when determining the originating status of the subsequently produced good, regardless of whether that material was produced by the producer of the good.

2. Each Party shall provide that if a non-originating material is used in the production of a good, the following may be counted as originating content for the purpose of determining whether the good meets a regional value content requirement:

(a) the value of processing of the non-originating materials undertaken in the territory of one or more of the Parties; and

(b) the value of any originating material used in the production of the non-originating material undertaken in the territory of one or more of the Parties.

Article 3.7: Value of Materials Used in Production

Each Party shall provide that for the purposes of this Chapter, the value of a material is:

(a) for a material imported by the producer of the good, the transaction value of the material at the time of importation, including the costs incurred in the international shipment of the material;

(b) for a material acquired in the territory where the good is produced:

(i) the price paid or payable by the producer in the Party where the producer is located;

(ii) the value as determined for an imported material in subparagraph (a); or

(iii) the earliest ascertainable price paid or payable in the territory of the Party; or

(c) for a material that is self-produced:

(i) all the costs incurred in the production of the material, which includes general expenses; and

(ii) an amount equivalent to the profit added in the normal course of trade, or equal to the profit that is usually reflected in the sale of goods of the same class or kind as the self-produced material that is being valued.

Article 3.8: Further Adjustments to the Value of Materials

1. Each Party shall provide that for an originating material, the following expenses may be added to the value of the material, if not included under Article 3.7 (Value of Materials Used in Production):

(a) the costs of freight, insurance, packing and all other costs incurred to transport the material to the location of the producer of the good;

(b) duties, taxes and customs brokerage fees on the material, paid in the territory of one or more of the Parties, other than duties and taxes that are waived, refunded, refundable or otherwise recoverable, which include credit against duty or tax paid or payable; and

(c) the cost of waste and spoilage resulting from the use of the material in the production of the good, less the value of reusable scrap or by-product.

2. Each Party shall provide that, for a non-originating material or material of undetermined origin, the following expenses may be deducted from the value of the material:

(a) the costs of freight, insurance, packing and all other costs incurred in transporting the material to the location of the producer of the good;

(b) duties, taxes and customs brokerage fees on the material paid in the territory of one or more of the Parties, other than duties and taxes that are waived, refunded, refundable or otherwise recoverable, which include credit against duty or tax paid or payable; and

(c) the cost of waste and spoilage resulting from the use of the material in the production of the good, less the value of reusable scrap or by-product.

3. If the cost or expense listed in paragraph 1 or 2 is unknown or documentary evidence of the amount of the adjustment is not available, then no adjustment is allowed for that particular cost.

Article 3.9: Net Cost

1. If Annex 3-D (Product-Specific Rules of Origin) specifies a regional value content requirement to determine whether an automotive good of subheading 8407.31 through 8407.34, 8408.20, subheading 8409.91 through 8409.99, heading 87.01 through 87.09 or heading 87.11 is originating, each Party shall provide that the requirement to determine the origin of that good based on the Net Cost Method is calculated as set out under Article 3.5 (Regional Value Content).

2. For the purposes of this Article:

(a) net cost means total cost minus sales promotion, marketing and after-sales service costs, royalties, shipping and packing costs, and non-allowable interest costs that are included in the total cost; and

(b) net cost of the good means the net cost that can be reasonably allocated to the good, using one of the following methods:

(i) calculating the total cost incurred with respect to all automotive goods produced by that producer, subtracting any sales promotion, marketing and after-sales service costs, royalties, shipping and packing costs, and non allowable interest costs that are included in the total cost of all those goods, and then reasonably allocating the resulting net cost of those goods to the good;

(ii) calculating the total cost incurred with respect to all automotive goods produced by that producer, reasonably allocating the total cost to the good, and then subtracting any sales promotion, marketing and after-sales service costs; royalties, shipping and packing costs, and non allowable interest costs that are included in the portion of the total cost allocated to the good; or

(iii) reasonably allocating each cost that forms part of the total cost incurred with respect to the good, so that the aggregate of these costs does not include any sales promotion, marketing and after-sales service costs, royalties, shipping and packing costs, and non-allowable interest costs, provided that the allocation of all those costs is consistent with the provisions regarding the reasonable allocation of costs set out in Generally Accepted Accounting Principles.

3. Each Party shall provide that, for the purposes of the Net Cost Method for motor vehicles of heading 87.01 through 87.06 or heading 87.11, the calculation may be averaged over the producer's fiscal year using any one of the following categories, on the basis of all motor vehicles in the category or only those motor vehicles in the category that are exported to the territory of another Party:

(a) the same model line of motor vehicles in the same class of motor vehicles produced in the same plant in the territory of a Party;

(b) the same class of motor vehicles produced in the same plant in the territory of a Party;

(c) the same model line of motor vehicles produced in the territory of a Party; or

(d) any other category as the Parties may decide.

4. Each Party shall provide that, for the purposes of the Net Cost Method in paragraphs 1 and 2, for automotive materials of subheading 8407.31 through 8407.34, 8408.20, heading 84.09, 87.06, 87.07, or 87.08, produced in the same plant, a calculation may be averaged:

(a) over the fiscal year of the motor vehicle producer to whom the good is sold;

(b) over any quarter or month; or

(c) over the fiscal year of the producer of the automotive material, provided that the good was produced during the fiscal year, quarter or month forming the basis for the calculation, in which:

(i) the average in subparagraph (a) is calculated separately for those goods sold to one or more motor vehicle producers; or

(ii) the average in subparagraph (a) or (b) is calculated separately for those goods that are exported to the territory of another Party.

5. For the purposes of this Article:

(a) class of motor vehicles means any one of the following categories of motor vehicles:

(i) motor vehicles classified under subheading 8701.20, motor vehicles for the transport of 16 or more persons classified under subheading 8702.10 or 8702.90, and motor vehicles classified under subheading 8704.10, 8704.22, 8704.23, 8704.32 or 8704.90, or heading 87.05 or 87.06;

(ii) motor vehicles classified under subheading 8701.10 or subheadings 8701.30 through 8701.90;

(iii) motor vehicles for the transport of 15 or fewer persons classified under subheading 8702.10 or 8702.90, and motor vehicles classified under subheading 8704.21 or 8704.31;

(iv) motor vehicles classified under subheadings 8703.21 through 8703.90; or

(v) motor vehicles classified under heading 87.11.

(b) model line of motor vehicles means a group of motor vehicles having the same platform or model name;

(c) non-allowable interest costs means interest costs incurred by a producer that exceed 700 basis points above the yield on debt obligations of comparable maturities issued by the central level of government of the Party in which the producer is located;

(d) reasonably allocate means to apportion in a manner appropriate under Generally Accepted Accounting Principles;

(e) royalty means payments of any kind, including payments under technical assistance or similar agreements, made as consideration for the use or right to use any copyright; literary, artistic or scientific work; patent; trademark; design; model; plan; secret formula or process, excluding those payments under technical assistance or similar agreements that can be related to specific services such as:

(i) personnel training, without regard to where that training is performed; or

(ii) engineering, tooling, die-setting, software design and similar computer services, or other services, if performed in the territory of one or more of the Parties;

(f) sales promotion, marketing and after-sales service costs means the following costs related to sales promotion, marketing and after sales service:

(i) sales and marketing promotion; media advertising; advertising and market research; promotional and demonstration materials; exhibits; sales conferences, trade shows and conventions; banners; marketing displays; free samples; sales, marketing and after-sales service literature (good brochures, catalogues, technical literature, price lists, service manuals and sales aid information); establishment and protection of logos and trademarks; sponsorships; wholesale and retail restocking charges; and entertainment;

(ii) sales and marketing incentives; consumer, retailer or wholesaler rebates; and merchandise incentives;

(iii) salaries and wages; sales commissions; bonuses; benefits (for example, medical, insurance or pension benefits); travelling and living expenses; and membership and professional fees for sales promotion, marketing and after sales service personnel;

(iv) recruiting and training of sales promotion, marketing and after-sales service personnel and after-sales training of customers' employees, if those costs are identified separately for sales promotion, marketing and after-sales service of goods on the financial statements or cost accounts of the producer;

(v) liability insurance for goods;

(vi) office supplies for sales promotion, marketing and after sales service of goods, if those costs are identified separately for sales promotion, marketing and after-sales service of goods on the financial statements or cost accounts of the producer;

(vii) telephone, mail and other communications, if those costs are identified separately for sales promotion, marketing and after-sales service of goods on the financial statements or cost accounts of the producer;

(viii) rent and depreciation of sales promotion, marketing and after-sales service offices and distribution centres;

(ix) property insurance premiums, taxes, cost of utilities, and repair and maintenance of sales promotion, marketing and after-sales service offices and distribution centres, if those costs are identified separately for sales promotion, marketing and after-sales service of goods on the financial statements or cost accounts of the producer; and

(x) payments by the producer to other persons for warranty repairs;

(g) shipping and packing costs means the costs incurred to pack a good for shipment and to ship the good from the point of direct shipment to the buyer, excluding costs to prepare and package the good for retail sale; and

(h) total cost means all product costs, period costs and other costs for a good incurred in the territory of one or more of the Parties, where:

(i) product costs are costs that are associated with the production of a good and include the value of materials, direct labour costs and direct overheads;

(ii) period costs are costs, other than product costs, that are expensed in the period in which they are incurred, such as selling expenses and general and administrative expenses; and

(iii) other costs are all costs recorded on the books of the producer that are not product costs or period costs, such as interest.

Total cost does not include profits that are earned by the producer, regardless of whether they are retained by the producer or paid out to other persons as dividends, or taxes paid on those profits, including capital gains taxes.

Article 3.10: Accumulation

1. Each Party shall provide that a good is originating if the good is produced in the territory of one or more of the Parties by one or more producers, provided that the good satisfies the requirements in Article 3.2 (Originating Goods) and all other applicable requirements in this Chapter.

2. Each Party shall provide that an originating good or material of one or more of the Parties that is used in the production of another good in the territory of another Party is considered as originating in the territory of the other Party.

3. Each Party shall provide that production undertaken on a non-originating material in the territory of one or more of the Parties by one or more producers may contribute toward the originating content of a good for the purpose of determining its origin, regardless of whether that production was sufficient to confer originating status to the material itself.

Article 3.11: De Minimis

1. Except as provided in Annex 3-C (Exceptions to Article 3.11 (De Minimis)), each Party shall provide that a good that contains non-originating materials that do not satisfy the applicable change in tariff classification requirement specified in Annex 3-D (Product-Specific Rules of Origin) for the good is nonetheless an originating good if the value of all those materials does not exceed 10 per cent of the value of the good, as defined under Article 3.1 (Definitions), and the good meets all the other applicable requirements of this Chapter.

2. Paragraph 1 applies only when using a non-originating material in the production of another good.

3. If a good described in paragraph 1 is also subject to a regional value content requirement, the value of those non-originating materials shall be included in the value of non-originating materials for the applicable regional value content requirement.

4. With respect to a textile or apparel good, Article 4.2 (Rules of Origin and Related Matters) applies in place of paragraph 1.

Article 3.12: Fungible Goods or Materials

Each Party shall provide that a fungible good or material is treated as originating based on the:

(a) physical segregation of each fungible good or material; or

(b) use of any inventory management method recognised in the Generally Accepted Accounting Principles if the fungible good or material is commingled, provided that the inventory management method selected is used throughout the fiscal year of the person that selected the inventory management method.

Article 3.13: Accessories, Spare Parts, Tools and Instructional or Other Information Materials

1. Each Party shall provide that:

(a) in determining whether a good is wholly obtained, or satisfies a process or change in tariff classification requirement as set out in Annex 3-D (Product-Specific Rules of Origin), accessories, spare parts, tools or instructional or other information materials, as described in paragraph 3, are to be disregarded; and

(b) in determining whether a good meets a regional value content requirement, the value of the accessories, spare parts, tools or instructional or other information materials, as described in paragraph 3, are to be taken into account as originating or non originating materials, as the case may be, in calculating the regional value content of the good.

2. Each Party shall provide that a good's accessories, spare parts, tools or instructional or other information materials, as described in paragraph 3, have the originating status of the good with which they are delivered.

3. For the purposes of this Article, accessories, spare parts, tools, and instructional or other information materials are covered when:

(a) the accessories, spare parts, tools and instructional or other information materials are classified with, delivered with but not invoiced separately from the good; and

(b) the types, quantities, and value of the accessories, spare parts, tools and instructional or other information materials are customary for that good.

Article 3.14: Packaging Materials and Containers for Retail Sale

1. Each Party shall provide that packaging materials and containers in which a good is packaged for retail sale, if classified with the good, are disregarded in determining whether all the non-originating materials used in the production of the good have satisfied the applicable process or change in tariff classification requirement set out in Annex 3-D (Product-Specific Rules of Origin) or whether the good is wholly obtained or produced.

2. Each Party shall provide that if a good is subject to a regional value content requirement, the value of the packaging materials and containers in which the good is packaged for retail sale, if classified with the good, are taken into account as originating or non-originating, as the case may be, in calculating the regional value content of the good.

Article 3.15: Packing Materials and Containers for Shipment

Each Party shall provide that packing materials and containers for shipment are disregarded in determining whether a good is originating.

Article 3.16: Indirect materials

Each Party shall provide that an indirect material is considered to be originating without regard to where it is produced.

Article 3.17: Sets of Goods

1. Each Party shall provide that for a set classified as a result of the application of rule 3(a) or (b) of the General Rules for the Interpretation of the Harmonized System, the originating status of the set shall be determined in accordance with the product-specific rule of origin that applies to the set.

2. Each Party shall provide that for a set classified as a result of the application of rule 3(c) of the General Rules for the Interpretation of the Harmonized System, the set is originating only if each good in the set is originating and both the set and the goods meet the other applicable requirements of this Chapter.

3. Notwithstanding paragraph 2, for a set classified as a result of the application of rule 3(c) of the General Rules for the Interpretation of the Harmonized System, the set is originating if the value of all the non-originating goods in the set does not exceed 10 per cent of the value of the set.

4. For the purposes of paragraph 3, the value of the non-originating goods in the set and the value of the set shall be calculated in the same manner as the value of non-originating materials and the value of the good.

Article 3.18: Transit and Transhipment

1. Each Party shall provide that an originating good retains its originating status if the good has been transported to the importing Party without passing through the territory of a non-Party.

2. Each Party shall provide that if an originating good is transported through the territory of one or more non-Parties, the good retains its originating status provided that the good:

(a) does not undergo any operation outside the territories of the Parties other than: unloading; reloading; separation from a bulk shipment; storing; labelling or marking required by the importing Party; or any other operation necessary to preserve it in good condition or to transport the good to the territory of the importing Party; and

(b) remains under the control of the customs administration in the territory of a non-Party.

Section B: Origin Procedures

Article 3.19: Application of Origin Procedures

Except as otherwise provided in Annex 3-A (Other Arrangements), each Party shall apply the procedures in this Section.

Article 3.20: Claims for Preferential Treatment

1. Except as otherwise provided in Annex 3-A (Other Arrangements), each Party shall provide that an importer may make a claim for preferential tariff treatment, based on a certification of origin completed by the exporter, producer or importer.

2. An importing Party may:

(a) require that an importer who completes a certification of origin provide documents or other information to support the certification;

(b) establish in its law conditions that an importer shall meet to complete a certification of origin;

(c) if an importer fails to meet or no longer meets the conditions established under subparagraph (b), prohibit that importer from providing its own certification as the basis of a claim for preferential tariff treatment; or

(d) if a claim for preferential tariff treatment is based on a certification of origin completed by an importer, prohibit that importer from making a subsequent claim for preferential tariff treatment for the same importation based on a certification of origin completed by the exporter or producer.

3. Each Party shall provide that a certification of origin:

(a) need not follow a prescribed format;

(b) be in writing, including electronic format;

(c) specifies that the good is both originating and meets the requirements of this Chapter; and

(d) contains a set of minimum data requirements as set out in Annex 3- B (Minimum Data Requirements).

4. Each Party shall provide that a certification of origin may apply to:

(a) a single shipment of a good into the territory of a Party; or

(b) multiple shipments of identical goods within any period specified in the certification of origin, but not exceeding 12 months.

5. Each Party shall provide that a certification of origin is valid for one year after the date that it was issued or for such longer period specified by the laws and regulations of the importing Party.

6. Each Party shall allow an importer to submit a certification of origin in English. If the certification of origin is not in English, the importing Party may require the importer to submit a translation in the language of the importing Party.

Article 3.21: Basis of a Certification of Origin

1. Each Party shall provide that if a producer certifies the origin of a good, the certification of origin is completed on the basis of the producer having information that the good is originating.

2. Each Party shall provide that if the exporter is not the producer of the good, a certification of origin may be completed by the exporter of the good on the basis of:

(a) the exporter having information that the good is originating; or

(b) reasonable reliance on the producer's information that the good is originating.

3. Each Party shall provide that a certification of origin may be completed by the importer of the good on the basis of:

(a) the importer having documentation that the good is originating; or

(b) reasonable reliance on supporting documentation provided by the exporter or producer that the good is originating.

4. For greater certainty, nothing in paragraph 1 or 2 shall be construed to allow a Party to require an exporter or producer to complete a certification of origin or provide a certification of origin to another person.

Article 3.22: Discrepancies

Each Party shall provide that it shall not reject a certification of origin due to minor errors or discrepancies in the certification of origin.

Article 3.23: Waiver of Certification of Origin

No Party shall require a certification of origin if:

(a) the customs value of the importation does not exceed US $1,000 or the equivalent amount in the importing Party's currency or any higher amount as the importing Party may establish; or

(b) it is a good for which the importing Party has waived the requirement or does not require the importer to present a certification of origin, provided that the importation does not form part of a series of importations carried out or planned for the purpose of evading compliance with the importing Party's laws governing claims for preferential tariff treatment under this Agreement.

Article 3.24: Obligations Relating to Importation

1. Except as otherwise provided for in this Chapter, each Party shall provide that, for the purpose of claiming preferential tariff treatment, the importer shall:

(a) make a declaration that the good qualifies as an originating good;

(b) have a valid certification of origin in its possession at the time the declaration referred to in subparagraph (a) is made;

(c) provide a copy of the certification of origin to the importing Party if required by the Party; and

(d) if required by a Party to demonstrate that the requirements in Article 3.18 (Transit and Transhipment) have been satisfied, provide relevant documents, such as transport documents, and in the case of storage, storage or customs documents.

2. Each Party shall provide that, if the importer has reason to believe that the certification of origin is based on incorrect information that could affect the accuracy or validity of the certification of origin, the importer shall correct the importation document and pay any customs duty and, if applicable, penalties owed.

3. No importing Party shall subject an importer to a penalty for making an invalid claim for preferential tariff treatment if the importer, on becoming aware that such a claim is not valid and prior to discovery of the error by that Party, voluntarily corrects the claim and pays any applicable customs duty under the circumstances provided for in the Party's law.

Article 3.25: Obligations Relating to Exportation

1. Each Party shall provide that an exporter or producer in its territory that completes a certification of origin shall submit a copy of that certification of origin to the exporting Party, on its request.

2. Each Party may provide that a false certification of origin or other false information provided by an exporter or a producer in its territory to support a claim that a good exported to the territory of another Party is originating has the same legal consequences, with appropriate modifications, as those that would apply to an importer in its territory that makes a false statement or representation in connection with an importation.

3. Each Party shall provide that if an exporter or a producer in its territory has provided a certification of origin and has reason to believe that it contains or is based on incorrect information, the exporter or producer shall promptly notify, in writing, every person and every Party to whom the exporter or producer provided the certification of origin of any change that could affect the accuracy or validity of the certification of origin.

Article 3.26: Record Keeping Requirements

1. Each Party shall provide that an importer claiming preferential tariff treatment for a good imported into the territory of that Party shall maintain, for a period of no less than five years from the date of importation of the good:

(a) the documentation related to the importation, including the certification of origin that served as the basis for the claim; and

(b) all records necessary to demonstrate that the good is originating and qualified for preferential tariff treatment, if the claim was based on a certification of origin completed by the importer.

2. Each Party shall provide that a producer or exporter in its territory that provides a certification of origin shall maintain, for a period of no less than five years from the date the certification of origin was issued, all records necessary to demonstrate that a good for which the exporter or producer provided a certification of origin is originating. Each Party shall endeavour to make available information on types of records that may be used to demonstrate that a good is originating.

3. Each Party shall provide that an importer, exporter or producer in its territory may choose to maintain the records specified in paragraphs 1 and 2 in any medium that allows for prompt retrieval, including electronic, optical, magnetic or written form in accordance with that Party's law.

Article 3.27: Verification of Origin

1. For the purpose of determining whether a good imported into its territory is originating, the importing Party may conduct a verification of any claim for preferential tariff treatment by one or more of the following:

(a) a written request for information from the importer of the good;

(b) a written request for information from the exporter or producer of the good;

(c) a verification visit to the premises of the exporter or producer of the good;

(d) for a textile or apparel good, the procedures set out in Article 4.6 (Verification); or

(e) other procedures as may be decided by the importing Party and the Party where an exporter or producer of the good is located.

2. If an importing Party conducts a verification, it shall accept information directly from the importer, exporter or producer.

3. If a claim for preferential tariff treatment is based on a certification of origin completed by the exporter or producer and, in response to a request for information by an importing Party under paragraph 1(a), the importer does not provide information to the importing Party or the information provided is not sufficient to support a claim for preferential tariff treatment, the importing Party shall request information from the exporter or producer under paragraph 1(b) or 1(c) before it may deny the claim for preferential tariff treatment. The importing Party shall complete the verification, including any additional request to the exporter or producer under paragraph 1(b) or 1(c), within the time provided in paragraph 6(e).

4. A written request for information or for a verification visit under paragraphs 1(a) through 1(c) shall:

(a) be in English or in an official language of the Party of the person to whom the request is made;

(b) include the identity of the government authority issuing the request;

(c) state the reason for the request, including the specific issue the requesting Party seeks to resolve with the verification;

(d) include sufficient information to identify the good that is being verified;

(e) include a copy of relevant information submitted with the good, including the certification of origin; and

(f) in the case of a verification visit, request the written consent of the exporter or producer whose premises are going to be visited, and state the proposed date and location for the visit and its specific purpose.

5. If an importing Party has initiated a verification in accordance with paragraph 1(b) or 1(c), it shall inform the importer of the initiation of the verification.

6. For a verification under paragraphs 1(a) through 1(c), the importing Party shall:

(a) ensure that a written request for information, or for documentation to be reviewed during a verification visit, is limited to information and documentation to determine whether the good is originating;

(b) describe the information or documentation in sufficient detail to allow the importer, exporter or producer to identify the information and documentation necessary to respond;

(c) allow the importer, exporter or producer at least 30 days from the date of receipt of the written request for information under paragraph 1(a) or 1(b) to respond;

(d) allow the exporter or producer 30 days from the date of receipt of the written request for a visit under paragraph 1(c) to consent or refuse the request; and

(e) make a determination following a verification as expeditiously as possible and no later than 90 days after it receives the information necessary to make the determination, including, if applicable, any information received under paragraph 9, and no later than 365 days after the first request for information or other action under paragraph 1. If permitted by its law, a Party may extend the 365 day period in exceptional cases, such as where the technical information concerned is very complex.

7. If an importing Party makes a verification request under paragraph 1(b), it shall, on request of the Party where the exporter or producer is located and in accordance with the importing Party's laws and regulations, inform that Party. The Parties concerned shall decide the manner and timing of informing the Party where the exporter or producer is located of the verification request. In addition, on request of the importing Party, the Party where the exporter or producer is located may, as it deems appropriate and in accordance with its laws and regulations, assist with the verification. This assistance may include providing a contact point for the verification, collecting information from the exporter or producer on behalf of the importing Party, or other activities in order that the importing Party may make a determination as to whether the good is originating. The importing Party shall not deny a claim for preferential tariff treatment solely on the ground that the Party where the exporter or producer is located did not provide requested assistance.

8. If an importing Party initiates a verification under paragraph 1(c), it shall, at the time of the request for the visit, inform the Party where the exporter or producer is located and provide the opportunity for the officials of the Party where the exporter or producer is located to accompany them during the visit.

9. Prior to issuing a written determination, the importing Party shall inform the importer and any exporter or producer that provided information directly to the importing Party, of the results of the verification and, if the importing Party intends to deny preferential tariff treatment, provide those persons a period of at least 30 days for the submission of additional information relating to the origin of the good.

10. The importing Party shall:

(a) provide the importer with a written determination of whether the good is originating that includes the basis for the determination; and

(b) provide the importer, exporter or producer that provided information during the verification or certified that the good was originating with the results of the verification and the reasons for that result.

11. During verification, the importing Party shall allow the release of the good, subject to payment of duties or provision of security as provided for in its law. If as a result of the verification the importing Party determines that the good is an originating good, it shall grant preferential tariff treatment to the good and refund any excess duties paid or release any security provided, unless the security also covers other obligations.

12. If verifications of identical goods by a Party indicate a pattern of conduct by an importer, exporter or producer of false or unsupported representations relevant to a claim that a good imported into its territory qualifies as an originating good, the Party may withhold preferential tariff treatment to identical goods imported, exported or produced by that person until that person

demonstrates that the identical goods qualify as originating. For the purposes of this paragraph, "identical goods" means goods that are the same in all respects relevant to the particular rule of origin that qualifies the goods as originating.

13. For the purpose of a verification request, it is sufficient for a Party to rely on the contact information of an exporter, producer or importer in a Party provided in a certification of origin.

Article 3.28: Determinations on Claims for Preferential Tariff Treatment

1. Except as otherwise provided in paragraph 2 or Article 4.7 (Determinations), each Party shall grant a claim for preferential tariff treatment made in accordance with this Chapter for a good that arrives in its territory on or after the date of entry into force of this Agreement for that Party. In addition, if permitted by the importing Party, the importing Party shall grant a claim for preferential tariff treatment made in accordance with this Chapter for a good which is imported into its territory or released from customs control on or after the date of entry into force of this Agreement for that Party.

2. The importing Party may deny a claim for preferential tariff treatment if:

(a) it determines that the good does not qualify for preferential treatment;

(b) pursuant to a verification under Article 3.27 (Verification of Origin), it has not received sufficient information to determine that the good qualifies as originating;

(c) the exporter, producer or importer fails to respond to a written request for information in accordance with Article 3.27 (Verification of Origin);

(d) after receipt of a written notification for a verification visit, the exporter or producer does not provide its written consent in accordance with Article 3.27 (Verification of Origin); or

(e) the importer, exporter or producer fails to comply with the requirements of this Chapter.

3. If an importing Party denies a claim for preferential tariff treatment, it shall issue a determination to the importer that includes the reasons for the determination.

4. A Party shall not reject a claim for preferential tariff treatment for the sole reason that the invoice was issued in a non-Party. If an invoice is issued in a non Party, a Party shall require that the certification of origin be separate from the invoice.

Article 3.29: Refunds and Claims for Preferential Tariff Treatment after Importation

1. Each Party shall provide that an importer may apply for preferential tariff treatment and a refund of any excess duties paid for a good if the importer did not make a claim for preferential tariff treatment at the time of importation, provided that the good would have qualified for preferential tariff treatment when it was imported into the territory of the Party.

2. As a condition for preferential tariff treatment under paragraph 1, the importing Party may require that the importer:

(a) make a claim for preferential tariff treatment;

(b) provide a statement that the good was originating at the time of importation;

(c) provide a copy of the certification of origin; and

(d) provide such other documentation relating to the importation of the good as the importing Party may require, no later than one year after the date of importation or a longer period if specified in the importing Party's law.

Article 3.30: Penalties

A Party may establish or maintain appropriate penalties for violations of its laws and regulations related to this Chapter.

Article 3.31: Confidentiality

Each Party shall maintain the confidentiality of the information collected in accordance with this Chapter and shall protect that information from disclosure that could prejudice the competitive position of the person providing the information.

Section C: Other Matters

Article 3.32: Committee on Rules of Origin and Origin Procedures

1. The Parties hereby establish a Committee on Rules of Origin and Origin Procedures (Committee), composed of government representatives of each Party, to consider any matters arising under this Chapter.

2. The Committee shall consult regularly to ensure that this Chapter is administered effectively, uniformly and consistently with the spirit and objectives of this Agreement, and shall cooperate in the administration of this Chapter.

3. The Committee shall consult to discuss possible amendments or modifications to this Chapter and its Annexes, taking into account developments in technology, production processes or other related matters.

4. Prior to the entry into force of an amended version of the Harmonized System, the Committee shall consult to prepare updates to this Chapter that are necessary to reflect changes to the Harmonized System.

5. With respect to a textile or apparel good, Article 4.8 (Committee on Textile and Apparel Trade Matters) applies in place of this Article.

6. The Committee shall consult on the technical aspects of submission and the format of the electronic certification of origin.


ANNEX 3-A

OTHER ARRANGEMENTS

1. This Annex shall remain in force for a period of 12 years from the date of entry into force of this Agreement according to Article 30.5.1 (Entry into Force).

2. A Party may apply the arrangements under paragraph 5 only if it has notified the other Parties of its intention to apply those arrangements at the time of entry into force of this Agreement for that Party. That Party (the notifying Party) may apply these arrangements for a period not exceeding five years after the date of entry into force of this Agreement for that Party.

3. The notifying Party may extend the period under paragraph 2 for one additional period of no more than five years if it notifies the other Parties no later than 60 days prior to the expiration of the initial period.

4. In no case shall a Party apply the arrangements under paragraph 5 beyond 12 years from the date of entry into force of this Agreement according to Article 30.5.1 (Entry into Force).

5. An exporting Party may require that a certification of origin for a good exported from its territory be either:

(a) issued by a competent authority; or

(b) completed by an approved exporter.

6. If an exporting Party applies the arrangements under paragraph 5, it shall provide the requirements for those arrangements in publicly available laws or regulations, inform the other Parties at the time of the notification under paragraph 2, and inform the other Parties at least 90 days before any modification

to the requirements comes into effect.

7. An importing Party may treat a certification of origin issued by a competent authority or completed by an approved exporter in the same manner as a certification of origin under Section B.

8. An importing Party may condition acceptance of a certification of origin issued by a competent authority or completed by an approved exporter on the authentication of elements such as stamps, signatures or approved exporter numbers. To facilitate that authentication, the Parties concerned shall exchange information on those elements.

9. If a claim for preferential tariff treatment is based on a certification of origin issued by a competent authority or completed by an approved exporter, the importing Party may make a verification request to the exporter or producer in accordance with Article 3.27 (Verification of Origin) or to the competent authority that issued the certification of origin.

10. If a Party makes a verification request to the competent authority, the competent authority shall respond to it in the same manner as an exporter or producer under Article 3.27 (Verification of Origin). A competent authority shall maintain records in the same manner as an exporter or producer under Article 3.26

(Record Keeping Requirements). If the competent authority that issued the certification of origin fails to respond to a verification request, the importing Party may deny the claim for preferential tariff treatment.

11. If an importing Party makes a verification request under Article 3.27.1(b) (Verification of Origin), it shall, on request of the Party where the exporter or producer is located and in accordance with the importing Party's laws and regulations, inform that Party. The Parties concerned shall decide the manner and timing of informing the Party where the exporter or producer is located of the verification request. In addition, on request of the importing Party, the competent authority of the Party where the exporter or producer is located may, as it deems appropriate and in accordance with the laws and regulations of the Party where the exporter or producer is located, assist in the verification in the same manner as Article 3.27.7 (Verification of Origin).


ANNEX 3-B

MINIMUM DATA REQUIREMENTS

A certification of origin that is the basis for a claim for preferential tariff treatment under this Agreement shall include the following elements:

1. Importer, Exporter or Producer Certification of Origin

Indicate whether the certifier is the exporter, producer or importer in accordance with Article 3.20 (Claims for Preferential Treatment).

2. Certifier

Provide the certifier's name, address (including country), telephone number and e-mail address.

3. Exporter

Provide the exporter's name, address (including country), e-mail address and telephone number if different from the certifier. This information is not required if the producer is completing the certification of origin and does not know the identity of the exporter. The address of the exporter shall be the place of export of the good in a TPP country.

4. Producer

Provide the producer's name, address (including country), e-mail address and telephone number, if different from the certifier or exporter or, if there are multiple producers, state "Various" or provide a list of producers. A person that wishes for this information to remain confidential may state "Available upon request by the importing authorities". The address of a producer shall be the place of production of the good in a TPP country.

5. Importer

Provide, if known, the importer's name, address, e-mail address and telephone number. The address of the importer shall be in a TPP country.

6. Description and HS Tariff Classification of the Good

(a) Provide a description of the good and the HS tariff classification of the good to the 6-digit level. The description should be sufficient to relate it to the good covered by the certification; and

(b) If the certification of origin covers a single shipment of a good, indicate, if known, the invoice number related to the exportation.

7. Origin Criterion

Specify the rule of origin under which the good qualifies.

8. Blanket Period

Include the period if the certification covers multiple shipments of identical goods for a specified period of up to 12 months as set out in Article 3.20.4 (Claims for Preferential Treatment).

9. Authorised Signature and Date

The certification must be signed and dated by the certifier and accompanied by the following statement:

I certify that the goods described in this document qualify as originating and the information contained in this document is true and accurate. I assume responsibility for proving such representations and agree to maintain and present upon request or to make available during a verification visit, documentation necessary to support this certification.


ANNEX 3-C

EXCEPTIONS TO ARTICLE 3.11 (De Minimis)

Each Party shall provide that Article 3.11 (De Minimis) shall not apply to:

(a) non-originating materials of heading 04.01 through 04.06, or non originating dairy preparations containing over 10 per cent by dry weight of milk solids of subheading 1901.90 or 2106.90, used in the production of a good of heading 04.01 through 04.06 other than a good of subheading 0402.10 through 0402.29 or 0406.307;

(b) non-originating materials of heading 04.01 through 04.06, or non originating dairy preparations containing over 10 per cent by dry weight of milk solids of subheading 1901.90, used in the production of the following goods:

(i) infant preparations containing over 10 per cent by dry weight of milk solids of subheading 1901.10;

(ii) mixes and doughs, containing over 25 per cent by dry weight of butterfat, not put up for retail sale of subheading 1901.20;

(iii) dairy preparations containing over 10 per cent by dry weight of milk solids of subheading 1901.90 or 2106.90;

(iv) goods of heading 21.05;

(v) beverages containing milk of subheading 2202.90; or

(vi) animal feeds containing over 10 per cent by dry weight of milk solids of subheading 2309.90;

(c) non-originating materials of heading 08.05 or subheading 2009.11 through 2009.39, used in the production of a good of subheading 2009.11 through 2009.39 or a fruit or vegetable juice of any single fruit or vegetable, fortified with minerals or vitamins, concentrated or unconcentrated, of subheading 2106.90 or 2202.90;

(d) non-originating materials of Chapter 15 of the Harmonized System, used in the production of a good of headings 15.07, 15.08, 15.12, or 15.14; or

(e) non-originating peaches, pears or apricots of Chapter 8 or 20 of the Harmonized System, used in the production of a good of heading 20.08.


ANNEX 3-D

PRODUCT-SPECIFIC RULES OF ORIGIN

Section A: General Interpretative Notes

1. For the purposes of interpreting the product-specific rules of origin set out in this Annex, the following definitions shall apply:

section means a section of the Harmonized System;

chapter means a chapter of the Harmonized System;

heading means the first four digits of the tariff classification number under the Harmonized System; and

subheading means the first six digits of the tariff classification number under the Harmonized System.

2. Under this Annex, a good is an originating good if it is produced entirely in the territory of one or more of the Parties by one or more producers using non originating materials, and:

(a) each of the non-originating materials used in the production of the good satisfies any applicable change in tariff classification requirement, or the good otherwise satisfies the production process requirement, regional value content requirement, or any other requirement specified in this Annex; and

(b) the good satisfies all other applicable requirements of Chapter 3 (Rules of Origin and Origin Procedures).

3. For the purposes of interpreting the product-specific rules of origin set out in this Annex:

(a) the specific rule, or specific set of rules, that applies to a particular heading, subheading or group of headings or subheadings is set out immediately adjacent to the heading, subheading or group of headings or subheadings;

(b) section, chapter or heading notes, where applicable, are found at the beginning of each section or chapter, and are read in conjunction with the product-specific rules of origin and may impose further conditions on, or provide an alternative to the product-specific rules of origin;

(c) the requirement of a change in tariff classification shall apply only to non-originating materials;

(d) if a product-specific rule of origin excludes certain materials of the Harmonized System, it shall be construed to mean that the product specific rule of origin requires that the excluded materials be originating for the good to be originating;

(e) if a good is subject to alternative product-specific rules of origin, the good shall be originating if it satisfies one of the alternatives;

(f) if a good is subject to a product-specific rule of origin that includes multiple requirements, the good shall be originating only if it satisfies all of the requirements; and

(g) if a single product-specific rule of origin applies to a group of headings or subheadings and that rule of origin specifies a change of heading or subheading, it shall be understood that the change in heading or subheading may occur from any other heading or subheading, as the case may be, including from any other heading or subheading within the group.

4. The product-specific rules of origin for textile or apparel goods as defined in Chapter 4 (Textile and Apparel Goods) are contained in Annex 4-A (Textiles and Apparel Product-Specific Rules of Origin).

5. For goods of chapters 84 and 87 marked with a symbol ( † ), an optional methodology for satisfying the regional value content requirement of the product specific rule of origin shall apply. This methodology is contained in Appendix 1 (Provisions Related to the Product-Specific Rules of Origin for Certain Vehicles and Parts of Vehicles) to this Annex.

Section B: Product-Specific Rules of Origin


ANNEX 3-D

APPENDIX 1

PROVISIONS RELATED TO THE PRODUCT-SPECIFIC RULES OF ORIGIN FOR CERTAIN VEHICLES AND PARTS OF VEHICLES

1. For the purpose of satisfying the regional value content requirement of the product-specific rule of origin applicable to a good of subheading 8701.10 through 8701.30, or heading 87.02 through 87.05, a material listed in Table A used in the production of that good is originating if:

(a) it meets the applicable requirements for that material under this Annex; or

(b) the production undertaken on that material in the territory of one or more of the Parties involves one or more of the operations listed in Table B.

2. For the purpose of satisfying the regional value content requirement of the product-specific rule of origin applicable to a good listed in Table C, a material used in the production of that good is originating if:

(a) it meets the applicable requirements for that material under this Annex; or

(b) subject to paragraph 3, the production undertaken on that material in the territory of one or more of the Parties involves one or more of the operations listed in Table B.

3. The value of the materials that are originating under paragraph 2(b) shall be counted as originating content, provided that the value counted as originating content does not exceed the applicable threshold listed in Table C of the value (Build-up Method/ Build-down Method) or net cost (Net Cost Method) of the good.

Table A

Table B

Note 1: "Complex" means an operation that requires specialised skills and the use of machines, apparatus or tools that are especially produced or installed to carry out that operation, regardless of whether such machines, apparatus or tools were produced with the intention of carrying out that operation on a specific good.

Note 2: The operations referred to in Table B do not include the mere assembly of non-originating components classified as a good in accordance with Rule 2(a) of the General Rules for the Interpretation of the Harmonized System.

Table C


CHAPTER 4

TEXTILE AND APPAREL GOODS

Article 4.1: Definitions

For the purposes of this Chapter:

customs offence means any act committed for the purpose of, or having the effect of, avoiding a Party's laws or regulations pertaining to the terms of this Agreement governing importations or exportations of textile or apparel goods between the Parties, specifically those that violate a customs law or regulation for restrictions or prohibitions on imports or exports, duty evasion, falsification of documents relating to the importation or exportation of goods, fraud or smuggling; and

transition period means the period beginning on the date of entry into force of this Agreement between the Parties concerned until five years after the date on which the importing Party eliminates duties on a good for the exporting Party pursuant to this Agreement.

Article 4.2: Rules of Origin and Related Matters

Application of Chapter 3

1. Except as provided in this Chapter, Chapter 3 (Rules of Origin and Origin Procedures) shall apply to textile and apparel goods.

De Minimis

2. A textile or apparel good classified outside of Chapters 61 through 63 of the Harmonized System that contains non-originating materials that do not satisfy the applicable change in tariff classification requirement specified in Annex 4-A (Textiles and Apparel Product-Specific Rules of Origin), shall nonetheless be considered to be an originating good if the total weight of all those materials is not more than 10 per cent of the total weight of the good and the good meets all the other applicable requirements of this Chapter and Chapter 3 (Rules of Origin and Origin Procedures).

3. A textile or apparel good classified in Chapters 61 through 63 of the Harmonized System that contains non-originating fibres or yarns in the component of the good that determines the tariff classification of the good that do not satisfy the applicable change in tariff classification set out in Annex 4-A (Textiles and Apparel Product-Specific Rules of Origin), shall nonetheless be considered to be an originating good if the total weight of all those fibres or yarns is not more than 10 per cent of the total weight of that component and the good meets all the other applicable requirements of this Chapter and Chapter 3 (Rules of Origin and Origin Procedures).

4. Notwithstanding paragraphs 2 and 3, a good described in paragraph 2 containing elastomeric yarn or a good described in paragraph 3 containing elastomeric yarn in the component of the good that determines the tariff classification of the good shall be considered to be an originating good only if such yarns are wholly formed in the territory of one or more of the Parties.

Treatment of Sets

5. Notwithstanding the textile and apparel product-specific rules of origin set out in Annex 4-A (Textiles and Apparel Product-Specific Rules of Origin), textile and apparel goods put up in sets for retail sale, classified as a result of the application of Rule 3 of the General Rules for the Interpretation of the Harmonized System, shall not be regarded as originating goods unless each of the goods in the set is an originating good or the total value of the non-originating goods in the set does not exceed 10 per cent of the value of the set.

6. For the purposes of paragraph 5:

(a) the value of non-originating goods in the set shall be calculated in the same manner as the value of non-originating materials in Chapter 3 (Rules of Origin and Origin Procedures); and

(b) the value of the set shall be calculated in the same manner as the value of the good in Chapter 3 (Rules of Origin and Origin Procedures).

Treatment of Short Supply List Materials

7. Each Party shall provide that, for the purposes of determining whether a textile or apparel good is originating under Article 3.2(c) (Originating Goods), a material listed in Appendix 1 (Short Supply List of Products) to Annex 4-A (Textiles and Apparel Product-Specific Rules of Origin) is originating provided that the material meets any requirement, including any end use requirement, specified in the Appendix 1 (Short Supply List of Products) to Annex 4-A (Textiles and Apparel Product-Specific Rules of Origin).

8. If a claim that a textile or apparel good is originating relies on the incorporation of a material listed in Appendix 1 (Short Supply List of Products) to Annex 4-A (Textiles and Apparel Product-Specific Rules of Origin), the importing Party may require in the importation documentation, such as a certification of origin, the number or description of the material on Appendix 1 (Short Supply List of Products) to Annex 4-A (Textiles and Apparel Product Specific Rules of Origin).

9. Non-originating materials marked as temporary in Appendix 1 (Short Supply List of Products) to Annex 4-A (Textiles and Apparel Product-Specific Rules of Origin) may be considered as originating under paragraph 7 for five years from the date of entry into force of this Agreement.

Treatment for Certain Handmade or Folkloric Goods

10. An importing Party may identify particular textile or apparel goods of an exporting Party to be eligible for duty-free or preferential tariff treatment that the importing and exporting Parties mutually agree fall within:

(a) hand-loomed fabrics of a cottage industry;

(b) hand-printed fabrics with a pattern created with a wax-resistance technique;

(c) hand-made cottage industry goods made of such hand-loomed or hand-printed fabrics; or

(d) traditional folklore handicraft goods;

provided that any requirements agreed by the importing and exporting Parties for such treatment are met.

Article 4.3: Emergency Actions

1. Subject to this Article if, as a result of the reduction or elimination of a customs duty under this Agreement, a textile or apparel good benefiting from preferential tariff treatment under this Agreement is being imported into the territory of a Party in such increased quantities, in absolute terms or relative to the domestic market for that good, and under such conditions as to cause serious damage, or actual threat thereof, to a domestic industry producing a like or directly competitive good, the importing Party may, to the extent and for such time as may be necessary to prevent or remedy such damage and to facilitate adjustment, take emergency action in accordance with paragraph 6, consisting of an increase in the rate of duty on the good of the exporting Party or Parties to a level not to exceed the lesser of:

(a) the most-favoured-nation applied rate of customs duty in effect at the time the action is taken; and

(b) the most-favoured nation applied rate of customs duty in effect on the day immediately preceding the date of entry into force of this Agreement for the importing Party.

2. Nothing in this Article shall be construed to limit the rights and obligations of a Party under Article XIX of GATT 1994 and the Safeguards Agreement, or Chapter 6 (Trade Remedies).

3. In determining serious damage, or actual threat thereof, the importing Party:

(a) shall examine the effect of increased imports from the exporting Party or Parties of a textile or apparel good benefiting from preferential tariff treatment under this Agreement on the particular industry, as reflected in changes in such relevant economic variables as output, productivity, utilisation of capacity, inventories, market share, exports, wages, employment, domestic prices, profits and investment, none of which either alone or combined with other factors shall necessarily be decisive; and

(b) shall not consider changes in technology or consumer preference in the importing Party as factors supporting a determination of serious damage, or actual threat thereof.

4. The importing Party may take an emergency action under this Article only following its publication of procedures that identify the criteria for a finding of serious damage, or actual threat thereof, and an investigation by its competent authorities. Such an investigation must use data based on the factors described in paragraph 3(a) that serious damage or actual threat thereof is demonstrably caused by increased imports of the product concerned as a result of this Agreement.

5. The importing Party shall submit to the exporting Party or Parties, without delay, written notice of the initiation of the investigation provided for in paragraph 4, as well as of its intent to take emergency action and, on the request of the exporting Party or Parties, shall enter into consultations with that Party or Parties regarding the matter. The importing Party shall provide the exporting Party or Parties with the full details of the emergency action to be taken. The Parties concerned shall begin consultations without delay and, unless otherwise decided, shall complete them within 60 days of receipt of the request. After completion of the consultations, the importing Party shall notify the exporting Party or Parties of any decision. If it decides to take an emergency action, the notification shall include the details of the emergency action, including when it will take effect.

6. The following conditions and limitations shall apply to any emergency action taken under this Article:

(a) no emergency action shall be maintained for a period exceeding two years unless extended for an additional period of up to two years;

(b) no emergency action shall be taken or maintained beyond the expiration of the transition period;

(c) no emergency action shall be taken by an importing Party against any particular good of another Party or Parties more than once; and

(d) on termination of the emergency action, the importing Party shall accord to the good that was subject to the emergency action the tariff treatment that would have been in effect but for the emergency action.

7. The Party taking an emergency action under this Article shall provide to the exporting Party or Parties against whose goods the emergency action is taken mutually agreed trade liberalising compensation in the form of concessions either having substantially equivalent trade effects or equivalent to the value of the additional duties expected to result from the emergency action. Such concessions shall be limited to textile and apparel goods, unless the Parties concerned otherwise agree. If the Parties concerned are unable to agree on compensation within 60 days or a longer period agreed by the Parties concerned, the Party or Parties against whose good the emergency action is taken may take tariff action that has trade effects substantially equivalent to the trade effects of the emergency action taken under this Article. The tariff action may be taken against any goods of the Party taking the emergency action. The Party taking the tariff action shall apply it only for the minimum period necessary to achieve the substantially equivalent trade effects. The importing Party's obligation to provide trade compensation and the exporting Party's right to take tariff action shall terminate when the emergency action terminates.

8. No Party shall take or maintain an emergency action under this Article against a textile or apparel good that is subject, or becomes subject, to a transitional safeguard measure under Chapter 6 (Trade Remedies), or to a safeguard measure that a Party takes pursuant to Article XIX of GATT 1994 and the Safeguards Agreement.

9. The investigations referred to in this Article shall be carried out according to procedures established by each Party. Each Party shall, on the date of entry into force of this Agreement for that Party or before it initiates an investigation, notify the other Parties of these procedures.

10. Each Party shall, in any year where it takes or maintains an emergency action under this Article, provide a report on such actions to the other Parties.

Article 4.4: Cooperation

1. Each Party shall, in accordance with its laws and regulations, cooperate with other Parties for the purposes of enforcing or assisting in the enforcement of their respective measures concerning customs offences for trade in textile or apparel goods between the Parties, including ensuring the accuracy of claims for preferential tariff treatment under this Agreement.

2. Each Party shall take appropriate measures, which may include legislative, administrative, judicial or other action for:

(a) enforcement of its laws, regulations and procedures related to customs offences; and

(b) cooperation with an importing Party in the enforcement of its laws, regulations and procedures related to the prevention of customs offences.

3. For the purposes of paragraph 2, "appropriate measures" means measures a Party takes, in accordance with its laws, regulations and procedures, such as:

(a) providing its government officials with the legal authority to meet the obligations under this Chapter;

(b) enabling its law enforcement officials to identify and address customs offences;

(c) establishing or maintaining criminal, civil or administrative penalties that are aimed at deterring customs offences;

(d) undertaking appropriate enforcement action when it believes, based on a request from another Party that includes relevant facts, that a customs offence has occurred or is occurring in the requested Party's territory with regard to a textile or apparel good, including in free trade zones of the requested Party; and

(e) cooperating with another Party, on request, to establish facts regarding customs offences in the requested Party's territory with regard to a textile or apparel good, including in free trade zones of the requested Party.

4. A Party may request information from another Party if it has relevant facts, such as historical evidence, indicating that a customs offence is occurring or is likely to occur.

5. Any request under paragraph 4 shall be made in writing, by electronic means or any other method that acknowledges receipt, and shall include a brief statement of the matter at issue, the cooperation requested, the relevant facts indicating a customs offence, and sufficient information for the requested Party to respond in accordance with its laws and regulations.

6. To enhance cooperative efforts under this Article between Parties to prevent and address customs offences, a Party that receives a request under paragraph 4 shall, subject to its laws, regulations and procedures, including those related to confidentiality referred to in Article 4.9.4 (Confidentiality) provide to the requesting Party, upon receipt of a request in accordance with paragraph 5, available information on the existence of an importer, exporter or producer, goods of an importer, exporter or producer, or other matters related to this Chapter. The information may include any available correspondence, reports, bills of lading, invoices, order contracts or other information regarding enforcement of laws or regulations related to the request.

7. A Party may provide information requested in this Article on paper or in electronic form.

8. Each Party shall designate and notify a contact point for cooperation under this Chapter in accordance with Article 27.5 (Contact Points) and shall notify the other Parties promptly of any subsequent changes.

Article 4.5: Monitoring

1. Each Party shall establish or maintain programmes or practices to identify and address textiles and apparel customs offences. This may include programmes or practices to ensure the accuracy of claims for preferential tariff treatment for textile and apparel goods under this Agreement.

2. Through those programmes or practices, a Party may collect or share information related to textiles or apparel goods for use for risk management purposes.

3. In addition to paragraphs 1 and 2, some Parties have bilateral agreements that apply between those Parties.

Article 4.6: Verification

1. An importing Party may conduct a verification with respect to a textile or apparel good pursuant to Article 3.27.1(a), Article 3.27.1(b) or Article 3.27.1(e) (Verification of Origin) and their associated procedures to verify whether a good qualifies for preferential tariff treatment or through a request for a site visit as described in this Article.3

2. An importing Party may request a site visit under this Article from an exporter or producer of textile or apparel goods to verify whether:

(a) a textile or apparel good qualifies for preferential tariff treatment under this Agreement; or

(b) customs offences are occurring or have occurred.

3. During a site visit under this Article, an importing Party may request access to:

(a) records and facilities relevant to the claim for preferential tariff treatment; or

(b) records and facilities relevant to the customs offences being verified.

4. If an importing Party seeks to conduct a site visit under paragraph 2, it shall notify the host Party, no later than 20 days before the visit, regarding:

(a) the proposed dates;

(b) the number of exporters and producers to be visited in appropriate detail to facilitate the provision of any assistance, but does not need to specify the names of the exporters or producers to be visited;

(c) whether assistance by the host Party will be requested and what type;

(d) if relevant, the customs offences being verified under paragraph 2(b), including relevant factual information available at the time of the notification related to the specific offences, which may include historical information; and

(e) whether the importer claimed preferential tariff treatment.

5. On receipt of information on a proposed visit under paragraph 2, the host Party may request information from the importing Party to facilitate planning of the visit, such as logistical arrangements or provision of requested assistance.

6. If an importing Party seeks to conduct a site visit under paragraph 2, it shall provide the host Party, as soon as practicable and prior to the date of the first visit to an exporter or producer under this Article, with a list of the names and addresses of the exporters or producers it proposes to visit.

7. If an importing Party seeks to conduct a site visit under paragraph 2:

(a) officials of the host Party may accompany the officials of the importing Party during the site visit;

(b) officials of the host Party may, in accordance with its laws and regulations, on request of the importing Party or on its own initiative, assist the officials of the importing Party during the site visit and provide, to the extent available, information relevant to conduct the site visit;

(c) the importing and host Parties shall limit communication regarding the site visit to relevant government officials and shall not inform the exporter or producer outside the government of the host Party in advance of a visit or provide any other verification or enforcement information not publicly available whose disclosure could undermine the effectiveness of the action;

(d) the importing Party shall request permission from the exporter or producer for access to the relevant records or facilities, no later than the time of the visit. Unless advance notice would undermine the effectiveness of the site visit, the importing Party shall request permission with appropriate advance notice; and

(e) if the exporter or producer of textile or apparel goods denies such permission or access, the visit will not occur. The importing Party shall give consideration to any reasonable alternative dates proposed, taking into account the availability of relevant employees or facilities of the person visited.

8. On completion of a site visit under paragraph 2, the importing Party shall:

(a) on request of the host Party, inform the host Party of its preliminary findings;

(b) on receiving a written request from the host Party, provide the host Party with a written report of the results of the visit, including any findings, no later than 90 days after the date of the request. If the report is not in English, the importing Party shall provide a translation of it in English on request of the host Party; and

(c) on receiving a written request of the exporter or producer, provide that person with a written report of the results of the visit as it pertains to that exporter or producer, including any findings, no later than 90 days after the date of the request. This may be a report prepared under subparagraph (b), with appropriate changes. The importing Party shall inform the exporter or producer of the entitlement to request this report. If the report is not in English, the importing Party shall provide a translation of it in English on request of that exporter or producer.

9. If an importing Party conducts a site visit under paragraph 2 and, as a result, intends to deny preferential tariff treatment to a textile or apparel good, it shall, before it may deny preferential tariff treatment, provide to the importer and any exporter or producer that provided information directly to the importing Party 30 days to submit additional information to support the claim for preferential tariff treatment. If advance notice was not given under paragraph 7(d), that importer, exporter or producer may request an additional 30 days.

10. The importing Party shall not reject a claim for preferential tariff treatment on the sole grounds that the host Party does not provide the requested assistance or information under this Article.

11. While a verification is being conducted under this Article, the importing Party may take appropriate measures under procedures established in its laws and regulations, including suspending or denying the application of preferential tariff treatment to textile or apparel goods of the exporter or producer subject to a verification.

12. If verifications of identical textile or apparel goods by an importing Party indicate a pattern of conduct by an exporter or producer of false or unsupported representations that a textile or apparel good imported into its territory qualifies for preferential tariff treatment, the importing Party may withhold preferential tariff treatment for identical textile or apparel goods imported, exported or produced by that person until it is demonstrated to the importing Party that those identical textile or apparel goods qualify for preferential tariff treatment. For the purposes of this paragraph, "identical textile or apparel goods" means textile or apparel goods that are the same in all respects relevant to the particular rule of origin that qualifies the goods as originating.

Article 4.7: Determinations

The importing Party may deny a claim for preferential tariff treatment for a textile or apparel good:

(a) for a reason listed in Article 3.28.2 (Determination on Claims for Preferential Tariff Treatment);

(b) if, pursuant to a verification under this Chapter, it has not received sufficient information to determine that the textile or apparel good qualifies as originating; or

(c) if, pursuant to a verification under this Chapter, access or permission for the visit is denied, the importing Party is prevented from completing the visit on the proposed date, and the exporter or producer does not provide an alternative date acceptable to the importing Party, or the exporter or producer does not provide access to the relevant records or facilities during a visit.

Article 4.8: Committee on Textile and Apparel Trade Matters

1. The Parties hereby establish a Committee on Textile and Apparel Trade Matters, (Committee), composed of government representatives of each Party.

2. The Committee shall meet at least once within one year of the date of entry into force of this Agreement, and thereafter at such times as the Parties decide and on request of the Commission. The Committee shall meet at such venues and times as the Parties decide.

3. The Committee may consider any matter arising under this Chapter, and its functions shall include review of the implementation of this Chapter, consultation on technical or interpretive difficulties that may arise under this Chapter, and discussion of ways to improve the effectiveness of cooperation under this Chapter.

4. In addition to discussions under the Committee, a Party may request in writing discussions with any other Party or Parties regarding matters under this Chapter concerning those Parties, with a view to resolution of the issue, if it believes difficulties are occurring with respect to implementation of this Chapter.

5. Unless the Parties amongst whom a discussion is requested agree otherwise, they shall hold the discussions pursuant to paragraph 4 within 30 days of receipt of a written request by a Party and endeavour to conclude within 90 days of receipt of the written request.

6. Discussions under this Article shall be confidential and without prejudice to the rights of any Party in any other proceeding.

7. Prior to the entry into force of an amended version of the Harmonized System, the Committee shall consult to prepare updates to this Chapter that are necessary to reflect changes to the Harmonized System.

Article 4.9: Confidentiality

1. Each Party shall maintain the confidentiality of the information collected in accordance with this Chapter and shall protect that information from disclosure that could prejudice the competitive position of the person providing the information.

2. If a Party provides information to another Party in accordance with this Chapter and designates the information as confidential, the other Party shall keep the information confidential. The Party that provides the information may require the other Party to furnish written assurance that the information will be held in confidence, used only for the purposes specified in the other Party's request for information, and not disclosed without the specific permission of the Party that provided the information or the person that provided the information to that Party.

3. A Party may decline to provide information requested by another Party if that Party has failed to act in conformity with paragraph 1 or 2.

4. Each Party shall adopt or maintain procedures for protecting from unauthorised disclosure confidential information submitted in accordance with the administration of the Party's customs or other laws related to this Chapter, or collected in accordance with this Chapter, including information the disclosure of which could prejudice the competitive position of the person providing the information.


ANNEX 4-A

TEXTILES AND APPAREL PRODUCT-SPECIFIC RULES OF ORIGIN

Section A: General Interpretative Notes

1. For the purposes of interpreting the product-specific rules of origin set out in this Annex, the following definitions shall apply:

section means a section of the Harmonized System;

chapter means a chapter of the Harmonized System;

heading means the first four digits of the tariff classification number under the Harmonized System; and

subheading means the first six digits of the tariff classification number under the Harmonized System.

2. Under this Annex, a good is an originating good if it is produced entirely in the territory of one or more of the Parties by one or more producers using non originating materials, and:

(a) each of the non-originating materials used in the production of the good satisfies any applicable change in tariff classification requirement, or the good otherwise satisfies the production process requirement or any other requirement specified in this Annex; and

(b) the good satisfies all other applicable requirements of Chapter 3 (Rules of Origin and Origin Procedures) or Chapter 4 (Textile and Apparel Goods).

3. For the purposes of interpreting the product-specific rules of origin set out in this Annex:

(a) the specific rule, or specific set of rules, that applies to a particular heading, subheading or group of headings or subheadings is set out immediately adjacent to the heading, subheading or group of headings or subheadings;

(b) chapter or heading notes, where applicable, are found at the beginning of each chapter, and are read in conjunction with the product-specific rules of origin and may impose further conditions on, or provide an alternative to the product-specific rules of origin;

(c) the requirement of a change in tariff classification shall apply only to non-originating materials;

(d) if a product-specific rule of origin excludes certain materials of the Harmonized System, it shall be construed to mean that the product specific rule of origin requires that the excluded materials be originating for the good to be originating;

(e) if a good is subject to a product-specific rule of origin that includes multiple requirements, the good shall be originating only if it satisfies all of the requirements;

(f) if a single product-specific rule of origin applies to a group of headings or subheadings and that rule of origin specifies a change of heading or subheading, it shall be understood that the change in heading or subheading may occur from any other heading or subheading, as the case may be, including from any other heading or subheading within the group; and

(g) the Short Supply List of Products, set out as Appendix 1 to this Annex, is read in conjunction with the product-specific rules of origin set out in this Annex.


ANNEX 4-A

APPENDIX 1

SHORT SUPPLY LIST OF PRODUCTS


CHAPTER 5

CUSTOMS ADMINISTRATION AND TRADE FACILITATION

Article 5.1: Customs Procedures and Facilitation of Trade

Each Party shall ensure that its customs procedures are applied in a manner that is predictable, consistent and transparent.

Article 5.2: Customs Cooperation

1. With a view to facilitating the effective operation of this Agreement, each Party shall:

(a) encourage cooperation with other Parties regarding significant customs issues that affect goods traded between the Parties; and

(b) endeavour to provide each Party with advance notice of any significant administrative change, modification of a law or regulation, or similar measure related to its laws or regulations that governs importations or exportations, that is likely to substantially affect the operation of this Agreement.

2. Each Party shall, in accordance with its law, cooperate with the other Parties through information sharing and other activities as appropriate, to achieve compliance with their respective laws and regulations that pertain to:

(a) the implementation and operation of the provisions of this Agreement governing importations or exportations, including claims for preferential tariff treatment, procedures for making claims for preferential tariff treatment and verification procedures;

(b) the implementation, application and operation of the Customs Valuation Agreement;

(c) restrictions or prohibitions on imports or exports;

(d) investigation and prevention of customs offences, including duty evasion and smuggling; and

(e) other customs matters as the Parties may decide.

3. If a Party has a reasonable suspicion of unlawful activity related to its laws or regulations governing importations, it may request that another Party provide

specific confidential information that is normally collected in connection with the importation of goods.

4. If a Party makes a request under paragraph 3, it shall:

(a) be in writing;

(b) specify the purpose for which the information is sought; and

(c) identify the requested information with sufficient specificity for the other Party to locate and provide the information.

5. The Party from which the information is requested under paragraph 3 shall, subject to its law and any relevant international agreements to which it is a party, provide a written response containing the requested information.

6. For the purposes of paragraph 3, "a reasonable suspicion of unlawful activity" means a suspicion based on relevant factual information obtained from public or private sources comprising one or more of the following:

(a) historical evidence of non-compliance with laws or regulations that govern importations by an importer or exporter;

(b) historical evidence of non-compliance with laws or regulations that govern importations by a manufacturer, producer or other person involved in the movement of goods from the territory of one Party to the territory of another Party;

(c) historical evidence of non-compliance with laws or regulations that govern importations by some or all of the persons involved in the movement of goods within a specific product sector from the territory of one Party to the territory of another Party; or

(d) other information that the requesting Party and the Party from which the information is requested agree is sufficient in the context of a particular request.

7. Each Party shall endeavour to provide another Party with any other information that would assist that Party to determine whether imports from, or exports to, that Party are in compliance with the receiving Party's laws or regulations that govern importations, in particular those related to unlawful activities, including smuggling and similar infractions.

8. In order to facilitate trade between the Parties, a Party receiving a request shall endeavour to provide the Party that made the request with technical advice and assistance for the purpose of:

(a) developing and implementing improved best practices and risk management techniques;

(b) facilitating the implementation of international supply chain standards;

(c) simplifying and enhancing procedures for clearing goods through customs in a timely and efficient manner;

(d) developing the technical skill of customs personnel; and

(e) enhancing the use of technologies that can lead to improved compliance with the requesting Party's laws or regulations that govern importations.

9. The Parties shall endeavour to establish or maintain channels of communication for customs cooperation, including by establishing contact points in order to facilitate the rapid and secure exchange of information and improve coordination on importation issues.

Article 5.3: Advance Rulings

1. Each Party shall issue, prior to the importation of a good of a Party into its territory, a written advance ruling at the written request of an importer in its territory, or an exporter or producer in the territory of another Party, with regard to:

(a) tariff classification;

(b) the application of customs valuation criteria for a particular case in accordance with the Customs Valuation Agreement;

(c) whether a good is originating in accordance with Chapter 3 (Rules of Origin and Origin Procedures); and

(d) such other matters as the Parties may decide.

2. Each Party shall issue an advance ruling as expeditiously as possible and in no case later than 150 days after it receives a request, provided that the requester has submitted all the information that the receiving Party requires to make the advance ruling. This includes a sample of the good for which the requester is seeking an advance ruling if requested by the receiving Party. In issuing an advance ruling, the Party shall take into account the facts and circumstances that the requester has provided. For greater certainty, a Party may decline to issue an advance ruling if the facts and circumstances forming the basis of the advance ruling are the subject of administrative or judicial review. A Party that declines to issue an advance ruling shall promptly notify the requester in writing, setting out the relevant facts and circumstances and the basis for its decision to decline to issue the advance ruling.

3. Each Party shall provide that its advance rulings shall take effect on the date that they are issued or on another date specified in the ruling, and remain in effect for at least three years, provided that the law, facts and circumstances on which the ruling is based remain unchanged. If a Party's law provides that an advance ruling becomes ineffective after a fixed period of time, that Party shall endeavour to provide procedures that allow the requester to renew the ruling expeditiously before it becomes ineffective, in situations in which the law, facts and circumstances on which the ruling was based remain unchanged.

4. After issuing an advance ruling, the Party may modify or revoke the advance ruling if there is a change in the law, facts or circumstances on which the ruling was based, if the ruling was based on inaccurate or false information, or if the ruling was in error.

5. A Party may apply a modification or revocation in accordance with paragraph 4 after it provides notice of the modification or revocation and the reasons for it.

6. No Party shall apply a revocation or modification retroactively to the detriment of the requester unless the ruling was based on inaccurate or false information provided by the requester.

7. Each Party shall ensure that requesters have access to administrative review of advance rulings.

8. Subject to any confidentiality requirements in its law, each Party shall endeavour to make its advance rulings publicly available, including online.

Article 5.4: Response to Requests for Advice or Information

On request from an importer in its territory, or an exporter or producer in the territory of another Party, a Party shall expeditiously provide advice or information relevant to the facts contained in the request on:

(a) the requirements for qualifying for quotas, such as tariff rate quotas;

(b) the application of duty drawback, deferral or other types of relief that reduce, refund or waive customs duties;

(c) the eligibility requirements for goods under Article 2.6 (Goods Re entered after Repair and Alteration);

(d) country of origin marking, if it is a prerequisite for importation; and

(e) other matters as the Parties may decide.

Article 5.5: Review and Appeal

1. Each Party shall ensure that any person to whom it issues a determination on a customs matter has access to:

(a) administrative review of the determination, independent4of the employee or office that issued the determination; and

(b) judicial review of the determination.

2. Each Party shall ensure that an authority that conducts a review under paragraph 1 notifies the parties to the matter in writing of its decision and the reasons for the decision. A Party may require a request as a condition for providing the reasons for a decision in the review.

Article 5.6: Automation

1. Each Party shall:

(a) endeavour to use international standards with respect to procedures for the release of goods;

(b) make electronic systems accessible to customs users;

(c) employ electronic or automated systems for risk analysis and targeting;

(d) endeavour to implement common standards and elements for import and export data in accordance with the World Customs Organization (WCO) Data Model;

(e) take into account, as appropriate, WCO standards, recommendations, models and methods developed through the WCO or APEC; and

(f) work toward developing a set of common data elements that are drawn from the WCO Data Model and related WCO recommendations as well as guidelines to facilitate government to government electronic sharing of data for purposes of analysing trade flows.

2. Each Party shall endeavour to provide a facility that allows importers and exporters to electronically complete standardised import and export requirements at a single entry point.

Article 5.7: Express Shipments

1. Each Party shall adopt or maintain expedited customs procedures for express shipments while maintaining appropriate customs control and selection. These procedures shall:

(a) provide for information necessary to release an express shipment to be submitted and processed before the shipment arrives;

(b) allow a single submission of information covering all goods contained in an express shipment, such as a manifest, through, if possible, electronic means;

(c) to the extent possible, provide for the release of certain goods with a minimum of documentation;

(d) under normal circumstances, provide for express shipments to be released within six hours after submission of the necessary customs documents, provided the shipment has arrived;

(e) apply to shipments of any weight or value recognising that a Party may require formal entry procedures as a condition for release, including declaration and supporting documentation and payment of customs duties, based on the good's weight or value; and

(f) provide that, under normal circumstances, no customs duties will be assessed on express shipments valued at or below a fixed amount set under the Party's law.7Each Party shall review the amount periodically taking into account factors that it may consider relevant, such as rates of inflation, effect on trade facilitation, impact on risk management, administrative cost of collecting duties compared to the amount of duties, cost of cross border trade transactions, impact on SMEs or other factors related to the collection of customs duties.

2. If a Party does not provide the treatment in paragraph 1(a) through (f) to all shipments, that Party shall provide a separate8and expedited customs procedure that provides that treatment for express shipments.

Article 5.8: Penalties

1. Each Party shall adopt or maintain measures that allow for the imposition of a penalty by a Party's customs administration for a breach of its customs laws, regulations or procedural requirements, including those governing tariff classification, customs valuation, country of origin and claims for preferential treatment under this Agreement.

2. Each Party shall ensure that a penalty imposed by its customs administration for a breach of a customs law, regulation or procedural requirement is imposed only on the person legally responsible for the breach.

3. Each Party shall ensure that the penalty imposed by its customs administration is dependent on the facts and circumstances9of the case and is commensurate with the degree and severity of the breach.

4. Each Party shall ensure that it maintains measures to avoid conflicts of interest in the assessment and collection of penalties and duties. No portion of the remuneration of a government official shall be calculated as a fixed portion or percentage of any penalties or duties assessed or collected.

5. Each Party shall ensure that if a penalty is imposed by its customs administration for a breach of a customs law, regulation or procedural requirement, an explanation in writing is provided to the person upon whom the penalty is imposed specifying the nature of the breach and the law, regulation or procedure used for determining the penalty amount.

6. If a person voluntarily discloses to a Party's customs administration the circumstances of a breach of a customs law, regulation or procedural requirement prior to the discovery of the breach by the customs administration, the Party's customs administration shall, if appropriate, consider this fact as a potential mitigating factor when a penalty is established for that person.

7. Each Party shall provide in its laws, regulations or procedures, or otherwise give effect to, a fixed and finite period within which its customs administration may initiate proceedings to impose a penalty relating to a breach of a customs law, regulation or procedural requirement.

8. Notwithstanding paragraph 7, a customs administration may impose, outside of the fixed and finite period, a penalty where this is in lieu of judicial or administrative tribunal proceedings.

Article 5.9: Risk Management

1. Each Party shall adopt or maintain a risk management system for assessment and targeting that enables its customs administration to focus its inspection activities on high-risk goods and that simplifies the clearance and movement of low-risk goods.

2. In order to facilitate trade, each Party shall periodically review and update, as appropriate, the risk management system specified in paragraph 1.

Article 5.10: Release of Goods

1. Each Party shall adopt or maintain simplified customs procedures for the efficient release of goods in order to facilitate trade between the Parties. This paragraph shall not require a Party to release a good if its requirements for release have not been met.

2. Pursuant to paragraph 1, each Party shall adopt or maintain procedures that:

(a) provide for the release of goods within a period no longer than that required to ensure compliance with its customs laws and, to the extent possible, within 48 hours of the arrival of the goods;

(b) provide for the electronic submission and processing of customs information in advance of the arrival of the goods in order to expedite the release of goods from customs control upon arrival;

(c) allow goods to be released at the point of arrival without temporary transfer to warehouses or other facilities; and

(d) allow an importer to obtain the release of goods prior to the final determination of customs duties, taxes and fees by the importing Party's customs administration when these are not determined prior to or promptly upon arrival, provided that the good is otherwise eligible for release and any security required by the importing Party has been provided or payment under protest, if required by a Party, has been made. Payment under protest refers to payment of duties, taxes and fees if the amount is in dispute and procedures are available to resolve the dispute.

3. If a Party allows for the release of goods conditioned on a security, it shall adopt or maintain procedures that:

(a) ensure that the amount of the security is no greater than that required to ensure that obligations arising from the importation of the goods will be fulfilled;

(b) ensure that the security shall be discharged as soon as possible after its customs administration is satisfied that the obligations arising from the importation of the goods have been fulfilled; and

(c) allow importers to provide security using non-cash financial instruments, including, in appropriate cases where an importer frequently enters goods, instruments covering multiple entries.

Article 5.11: Publication

1. Each Party shall make publicly available, including online, its customs laws, regulations, and general administrative procedures and guidelines, to the extent possible in the English language.

2. Each Party shall designate or maintain one or more enquiry points to address enquiries from interested persons concerning customs matters and shall make information concerning the procedures for making such enquiries publicly available online.

3. To the extent possible, each Party shall publish in advance regulations of general application governing customs matters that it proposes to adopt and shall provide interested persons the opportunity to comment before the Party adopts the regulation.

Article 5.12: Confidentiality

1. If a Party provides information to another Party in accordance with this Chapter and designates the information as confidential, the other Party shall keep the information confidential. The Party that provides the information may require the other Party to furnish written assurance that the information will be held in confidence, used only for the purposes specified in the other Party's request for information, and not disclosed without the specific permission of the Party that provided the information or the person that provided the information to that Party.

2. A Party may decline to provide information requested by another Party if that Party has failed to act in accordance with paragraph 1.

3. Each Party shall adopt or maintain procedures for protecting from unauthorised disclosure confidential information submitted in accordance with the administration of the Party's customs laws, including information the disclosure of which could prejudice the competitive position of the person providing the information.


CHAPTER 6

TRADE REMEDIES

Section A: Safeguard Measures

Article 6.1: Definitions

For the purposes of this Section:

domestic industry means, with respect to an imported good, the producers as a whole of the like or directly competitive good operating within the territory of a Party, or those producers whose collective production of the like or directly competitive good constitutes a major proportion of the total domestic production of that good;

serious injury means a significant overall impairment in the position of a domestic industry;

threat of serious injury means serious injury that, on the basis of facts and not merely on allegation, conjecture or remote possibility, is clearly imminent;

transition period means, in relation to a particular good, the three-year period beginning on the date of entry into force of this Agreement, except where the tariff elimination for the good occurs over a longer period of time, in which case the transition period shall be the period of the staged tariff elimination for that good; and

transitional safeguard measure means a measure described in Article 6.3.2 (Imposition of a Transitional Safeguard Measure).

Article 6.2: Global Safeguards

1. Nothing in this Agreement affects the rights and obligations of the Parties under Article XIX of GATT 1994 and the Safeguards Agreement.

2. Except as provided in paragraph 3, nothing in this Agreement shall confer any rights or impose any obligations on the Parties with regard to actions taken pursuant to Article XIX of GATT 1994 and the Safeguards Agreement.

3. A Party that initiates a safeguard investigatory process shall provide to the other Parties an electronic copy of the notification given to the WTO Committee on Safeguards under Article 12.1(a) of the Safeguards Agreement.

4. No Party shall apply or maintain a safeguard measure under this Chapter, to any product imported under a tariff rate quota (TRQ) established by the Party under this Agreement. A Party taking a safeguard measure under Article XIX of GATT 1994 and the Safeguards Agreement may exclude from the safeguard measure imports of originating goods under a TRQ established by the Party under this Agreement and set out in Appendix A to the Party's Schedule to Annex 2-D (Tariff Commitments), if such imports are not a cause of serious injury or threat thereof.

5. No Party shall apply or maintain two or more of the following measures, with respect to the same good, at the same time:

(a) a transitional safeguard measure under this Chapter;

(b) a safeguard measure under Article XIX of GATT 1994 and the Safeguards Agreement;

(c) a safeguard measure set out in Appendix B to its Schedule to Annex 2-D (Tariff Commitments); or

(d) an emergency action under Chapter 4 (Textiles and Apparel Goods).

Article 6.3: Imposition of a Transitional Safeguard Measure

1. A Party may apply a transitional safeguard measure described in paragraph 2, during the transition period only, if as a result of the reduction or elimination of a customs duty pursuant to this Agreement:

(a) an originating good of another Party, individually, is being imported into the Party's territory in such increased quantities, in absolute terms or relative to domestic production, and under such conditions, as to cause or threaten to cause serious injury to the domestic industry that produces a like or directly competitive good; or

(b) an originating good of two or more Parties, collectively, is being imported into the Party's territory in such increased quantities, in absolute terms or relative to domestic production, and under such conditions, as to cause or threaten to cause serious injury to the domestic industry that produces a like or directly competitive good, provided that the Party applying the transitional safeguard measure demonstrates, with respect to the imports from each such Party against which the transitional safeguard measure is applied, that imports of the originating good from each of those Parties have increased, in absolute terms or relative to domestic production, since the date of entry into force of this Agreement for those Parties.

2. If the conditions in paragraph 1 are met, the Party may, to the extent necessary to prevent or remedy serious injury and to facilitate adjustment:

(a) suspend the further reduction of any rate of customs duty provided for under this Agreement on the good; or

(b) increase the rate of customs duty on the good to a level not to exceed the lesser of:

(i) the most-favoured-nation applied rate of customs duty in effect at the time the measure is applied; and

(ii) the most-favoured-nation applied rate of customs duty in effect on the day immediately preceding the date of entry into force of this Agreement for that Party.

The Parties understand that neither tariff rate quotas nor quantitative restrictions would be a permissible form of transitional safeguard measure.

Article 6.4: Standards for a Transitional Safeguard Measure

1. A Party shall maintain a transitional safeguard measure only for such period of time as may be necessary to prevent or remedy serious injury and to facilitate adjustment.

2. That period shall not exceed two years, except that the period may be extended by up to one year if the competent authority of the Party that applies the measure determines, in conformity with the procedures set out in Article 6.5 (Investigation Procedures and Transparency Requirements), that the transitional safeguard measure continues to be necessary to prevent or remedy serious injury and to facilitate adjustment.

3. No Party shall maintain a transitional safeguard measure beyond the expiration of the transition period.

4. In order to facilitate adjustment in a situation where the expected duration of a transitional safeguard measure is over one year, the Party that applies the measure shall progressively liberalise it at regular intervals during the period of application.

5. On the termination of a transitional safeguard measure, the Party that applied the measure shall apply the rate of customs duty set out in the Party's Schedule to Annex 2-D (Tariff Commitments) as if that Party had never applied the transitional safeguard measure.

6. No Party shall apply a transitional safeguard measure more than once on the same good.

Article 6.5: Investigation Procedures and Transparency Requirements

1. A Party shall apply a transitional safeguard measure only following an investigation by the Party's competent authorities in accordance with Article 3 and Article 4.2(c) of the Safeguards Agreement; to this end, Article 3 and Article 4.2(c) of the Safeguards Agreement are incorporated into and made part of this Agreement, mutatis mutandis.

2. In the investigation described in paragraph 1, the Party shall comply with the requirements of Article 4.2(a) and Article 4.2(b) of the Safeguards Agreement; to this end, Article 4.2(a) and Article 4.2(b) of the Safeguards Agreement are incorporated into and made part of this Agreement, mutatis mutandis.

Article 6.6: Notification and Consultation

1. A Party shall promptly notify the other Parties, in writing, if it:

(a) initiates a transitional safeguard investigation under this Chapter;

(b) makes a finding of serious injury, or threat of serious injury, caused by increased imports, as set out in Article 6.3 (Imposition of a Transitional Safeguard Measure);

(c) takes a decision to apply or extend a transitional safeguard measure; and

(d) takes a decision to modify a transitional safeguard measure previously undertaken.

2. A Party shall provide to the other Parties a copy of the public version of the report of its competent authorities that is required under Article 6.5.1 (Investigation Procedures and Transparency Requirements).

3. When a Party makes a notification pursuant to paragraph 1(c) that it is applying or extending a transitional safeguard measure, that Party shall include in that notification:

(a) evidence of serious injury, or threat of serious injury, caused by increased imports of an originating good of another Party or Parties as a result of the reduction or elimination of a customs duty pursuant to this Agreement;

(b) a precise description of the originating good subject to the transitional safeguard measure including its heading or subheading under the HS Code, on which the schedules of tariff commitments in Annex 2-D (Tariff Commitments) are based;

(c) a precise description of the transitional safeguard measure;

(d) the date of the transitional safeguard measure's introduction, its expected duration and, if applicable, a timetable for progressive liberalisation of the measure; and

(e) in the case of an extension of the transitional safeguard measure, evidence that the domestic industry concerned is adjusting.

4. On request of a Party whose good is subject to a transitional safeguard proceeding under this Chapter, the Party that conducts that proceeding shall enter into consultations with the requesting Party to review a notification under paragraph 1 or any public notice or report that the competent investigating authority issued in connection with the proceeding.

Article 6.7: Compensation

1. A Party applying a transitional safeguard measure shall, after consultations with each Party against whose good the transitional safeguard measure is applied, provide mutually agreed trade liberalising compensation in the form of concessions that have substantially equivalent trade effects or equivalent to the value of the additional duties expected to result from the transitional safeguard measure. The Party shall provide an opportunity for those consultations no later than 30 days after the application of the transitional safeguard measure.

2. If the consultations under paragraph 1 do not result in an agreement on trade liberalising compensation within 30 days, any Party against whose good the transitional safeguard measure is applied may suspend the application of substantially equivalent concessions to the trade of the Party applying the transitional safeguard measure.

3. A Party against whose good the transitional safeguard measure is applied shall notify the Party applying the transitional safeguard measure in writing at least 30 days before it suspends concessions in accordance with paragraph 2.

4. The obligation to provide compensation under paragraph 1 and the right to suspend concessions under paragraph 2 terminates on the termination of the transitional safeguard measure.

Section B: Antidumping and Countervailing Duties

Article 6.8: Antidumping and Countervailing Duties

1. Each Party retains its rights and obligations under Article VI of GATT 1994, the AD Agreement and the SCM Agreement.

2. Nothing in this Agreement shall confer any rights or impose any obligations on the Parties with regard to proceedings or measures taken pursuant to Article VI of GATT 1994, the AD Agreement or the SCM Agreement.

3. No Party shall have recourse to dispute settlement under Chapter 28 (Dispute Settlement) for any matter arising under this Section or Annex 6-A (Practices Relating to Antidumping and Countervailing Duty Proceedings).

Annex 6-A

Practices Relating to Antidumping and Countervailing Duty Proceedings

The Parties recognise, in Article 6.8 (Antidumping and Countervailing Duties), the right of the Parties to apply trade remedy measures consistent with Article VI of GATT 1994, the AD Agreement and the SCM Agreement, and further recognise the following practices as promoting the goals of transparency and due process in trade remedy proceedings:

(a) Upon receipt by a Party's investigating authorities of a properly documented antidumping or countervailing duty application with respect to imports from another Party, and no later than seven days before initiating an investigation, the Party provides written notification of its receipt of the application to the other Party.

(b) In any proceeding in which the investigating authorities determine to conduct an in-person verification of information that is provided by a respondent,2and that is pertinent to the calculation of antidumping duty margins or the level of a countervailable subsidy, the investigating authorities promptly notify each respondent of their intent, and:

(i) provide to each respondent at least 10 working days advance notice of the dates on which the authorities intend to conduct an in-person verification of the information;

(ii) at least five working days prior to an in-person verification, provide to the respondent a document that sets out the topics the respondent should be prepared to address during the verification and that describes the types of supporting documentation to be made available for review; and

(iii) after an in-person verification is completed, and subject to the protection of confidential information3, issue a written report that describes the methods and procedures followed in carrying out the verification and the extent to which the information provided by the respondent was supported by the documents reviewed during the verification. The report is made available to all interested parties in sufficient time for the parties to defend their interests.

(c) A Party's investigating authorities maintain a public file for each investigation and review that contains:

(i) all non-confidential documents that are part of the record of the investigation or review; and

(ii) to the extent feasible without revealing confidential information, non-confidential summaries of confidential information that is contained in the record of each investigation or review. To the extent that individual information is not susceptible of summarisation, it may be aggregated by the investigating authority. The public file and a list of all documents that are contained in the record of the investigation or review are physically available for inspection and copying during the investigating authorities' normal business hours or electronically available for download.

(d) If, in an antidumping or countervailing duty action that involves imports from another Party, a Party's investigating authorities determine that a timely response to a request for information does not comply with the request, the investigating authorities inform the interested party that submitted the response of the nature of the deficiency and, to the extent practicable in light of time limits established to complete the antidumping or countervailing duty action, provide that interested party with an opportunity to remedy or explain the deficiency. If that interested party submits further information in response to that deficiency and the investigating authorities find that the response is not satisfactory, or that the response is not submitted within the applicable time limits, and if the investigating authorities disregard all or part of the original and subsequent responses, the investigating authorities explain in the determination or other written document the reasons for disregarding the information.

(e) Before a final determination is made, the investigating authorities inform all interested parties of the essential facts that form the basis of the decision whether to apply definitive measures. Subject to the protection of confidential information, the investigating authorities may use any reasonable means to disclose the essential facts, which includes a report summarising the data in the record, a draft or preliminary determination or some combination of those reports or determinations, to provide interested parties an opportunity to respond to the disclosure of essential facts.


CHAPTER 7

SANITARY AND PHYTOSANITARY MEASURES

Article 7.1: Definitions

1. The definitions in Annex A of the SPS Agreement are incorporated into this Chapter and shall form part of this Chapter, mutatis mutandis.

2. In addition, for the purposes of this Chapter:

competent authority means a government body of each Party responsible for measures and matters referred to in this Chapter;

emergency measure means a sanitary or phytosanitary measure that is applied by an importing Party to another Party to address an urgent problem of human, animal or plant life or health protection that arises or threatens to arise in the Party applying the measure;

import check means an inspection, examination, sampling, review of documentation, test or procedure, including laboratory, organoleptic or identity, conducted at the border by an importing Party or its representative to determine if a consignment complies with the sanitary and phytosanitary requirements of the importing Party;

import programme means mandatory sanitary or phytosanitary policies, procedures or requirements of an importing Party that govern the importation of goods;

primary representative means the government body of a Party that is responsible for the implementation of this Chapter and the coordination of that Party's participation in Committee activities under Article 7.5 (Committee on Sanitary and Phytosanitary Measures);

risk analysis means the process that consists of three components: risk assessment; risk management; and risk communication;

risk communication means the exchange of information and opinions concerning risk and risk-related factors between risk assessors, risk managers, consumers and other interested parties; and

risk management means the weighing of policy alternatives in light of the results of risk assessment and, if required, selecting and implementing appropriate control options, including regulatory measures.

Article 7.2: Objectives

The objectives of this Chapter are to:

(a) protect human, animal or plant life or health in the territories of the Parties while facilitating and expanding trade by utilising a variety of means to address and seek to resolve sanitary and phytosanitary issues;

(b) reinforce and build on the SPS Agreement;

(c) strengthen communication, consultation and cooperation between the Parties, and particularly between the Parties' competent authorities and primary representatives;

(d) ensure that sanitary or phytosanitary measures implemented by a Party do not create unjustified obstacles to trade;

(e) enhance transparency in and understanding of the application of each Party's sanitary and phytosanitary measures; and

(f) encourage the development and adoption of international standards, guidelines and recommendations, and promote their implementation by the Parties.

Article 7.3: Scope

1. This Chapter shall apply to all sanitary and phytosanitary measures of a Party that may, directly or indirectly, affect trade between the Parties.

2. Nothing in this Chapter prevents a Party from adopting or maintaining halal requirements for food and food products in accordance with Islamic law.

Article 7.4: General Provisions

1. The Parties affirm their rights and obligations under the SPS Agreement.

2. Nothing in this Agreement shall limit the rights and obligations that each Party has under the SPS Agreement.

Article 7.5: Committee on Sanitary and Phytosanitary Measures

1. For the purposes of the effective implementation and operation of this Chapter, the Parties hereby establish a Committee on Sanitary and Phytosanitary Measures (Committee), composed of government representatives of each Party responsible for sanitary and phytosanitary matters.

2. The objectives of the Committee are to:

(a) enhance each Party's implementation of this Chapter;

(b) consider sanitary and phytosanitary matters of mutual interest; and

(c) enhance communication and cooperation on sanitary and phytosanitary matters.

3. The Committee:

(a) shall provide a forum to improve the Parties' understanding of sanitary and phytosanitary issues that relate to the implementation of the SPS Agreement and this Chapter;

(b) shall provide a forum to enhance mutual understanding of each Party's sanitary and phytosanitary measures and the regulatory processes that relate to those measures;

(c) shall exchange information on the implementation of this Chapter;

(d) shall determine the appropriate means, which may include ad hoc working groups, to undertake specific tasks related to the functions of the Committee;

(e) may identify and develop technical assistance and cooperation projects between the Parties on sanitary and phytosanitary measures;

(f) may serve as a forum for a Party to share information on a sanitary or phytosanitary issue that has arisen between it and another Party or Parties, provided that the Parties between which the issue has arisen have first attempted to address the issue through discussions between themselves; and

(g) may consult on matters and positions for the meetings of the Committee on Sanitary and Phytosanitary Measures established under Article 12 of the SPS Agreement (WTO SPS Committee), and meetings held under the auspices of the Codex Alimentarius Commission, the World Organisation for Animal Health and the International Plant Protection Convention.

4. The Committee shall establish its terms of reference at its first meeting and may revise those terms as needed.

5. The Committee shall meet within one year of the date of entry into force of this Agreement and once a year thereafter unless Parties agree otherwise.

Article 7.6: Competent Authorities and Contact Points

Each Party shall provide the other Parties with a written description of the sanitary and phytosanitary responsibilities of its competent authorities and contact points within each of these authorities and identify its primary representative within 60 days of the date of entry into force of this Agreement for that Party. Each Party shall keep this information up to date.

Article 7.7: Adaptation to Regional Conditions, Including Pest- or Disease Free Areas and Areas of Low Pest or Disease Prevalence

1. The Parties recognise that adaptation to regional conditions, including regionalisation, zoning and compartmentalisation, is an important means to facilitate trade.

2. The Parties shall take into account the relevant guidance of the WTO SPS Committee and international standards, guidelines and recommendations.

3. The Parties may cooperate on the recognition of pest- or disease-free areas, and areas of low pest or disease prevalence with the objective of acquiring confidence in the procedures followed by each Party for the recognition of pest or disease-free areas, and areas of low pest or disease prevalence.

4. When an importing Party receives a request for a determination of regional conditions from an exporting Party and determines that the information provided by the exporting Party is sufficient, it shall initiate an assessment within a reasonable period of time.

5. When an importing Party commences an assessment of a request for a determination of regional conditions under paragraph 4, that Party shall promptly, on request of the exporting Party, explain its process for making the determination of regional conditions.

6. On request of the exporting Party, the importing Party shall inform the exporting Party of the status of the assessment of the exporting Party's request for a determination of regional conditions.

7. When an importing Party adopts a measure that recognises specific regional conditions of an exporting Party, the importing Party shall communicate that measure to the exporting Party in writing and implement the measure within a reasonable period of time.

8. The importing and exporting Parties involved in a particular determination may also decide in advance the risk management measures that will apply to trade between them in the event of a change in the status.

9. The Parties involved in a determination recognising regional conditions are encouraged, if mutually agreed, to report the outcome to the Committee.

10. If the evaluation of the evidence provided by the exporting Party does not result in a determination to recognise pest- or disease-free areas, or areas of low pest and disease prevalence, the importing Party shall provide the exporting Party with the rationale for its determination.

11. If there is an incident that results in the importing Party modifying or revoking the determination recognising regional conditions, on request of the exporting Party, the Parties involved shall cooperate to assess whether the determination can be reinstated.

Article 7.8: Equivalence

1. The Parties acknowledge that recognition of the equivalence of sanitary and phytosanitary measures is an important means to facilitate trade. Further to Article 4 of the SPS Agreement, the Parties shall apply equivalence to a group of measures or on a systems-wide basis, to the extent feasible and appropriate. In determining the equivalence of a specific sanitary or phytosanitary measure, group of measures or on a systems-wide basis, each Party shall take into account the relevant guidance of the WTO SPS Committee and international standards, guidelines and recommendations.

2. On request of the exporting Party, the importing Party shall explain the objective and rationale of its sanitary or phytosanitary measure and clearly identify the risk the sanitary or phytosanitary measure is intended to address.

3. When an importing Party receives a request for an equivalence assessment and determines that the information provided by the exporting Party is sufficient, it shall initiate the equivalence assessment within a reasonable period of time.

4. When an importing Party commences an equivalence assessment, that Party shall promptly, on request of the exporting Party, explain its equivalence process and plan for making the equivalence determination and, if the determination results in recognition, for enabling trade.

5. In determining the equivalence of a sanitary or phytosanitary measure, an importing Party shall take into account available knowledge, information and relevant experience, as well as the regulatory competence of the exporting Party.

6. The importing Party shall recognise the equivalence of a sanitary or phytosanitary measure if the exporting Party objectively demonstrates to the importing Party that the exporting Party's measure:

(a) achieves the same level of protection as the importing Party's measure; or

(b) has the same effect in achieving the objective as the importing Party's measure.2

7. When an importing Party adopts a measure that recognises the equivalence of an exporting Party's specific sanitary or phytosanitary measure, group of measures or measures on a systems-wide basis, the importing Party shall communicate the measure it has adopted to the exporting Party in writing and implement the measure within a reasonable period of time.

8. The Parties involved in an equivalence determination that results in recognition are encouraged, if mutually agreed, to report the outcome to the Committee.

9. If an equivalence determination does not result in recognition by the importing Party, the importing Party shall provide the exporting Party with the rationale for its decision.

Article 7.9: Science and Risk Analysis

1. The Parties recognise the importance of ensuring that their respective sanitary and phytosanitary measures are based on scientific principles.

2. Each Party shall ensure that its sanitary and phytosanitary measures either conform to the relevant international standards, guidelines or recommendations or, if its sanitary and phytosanitary measures do not conform to international standards, guidelines or recommendations, that they are based on documented and objective scientific evidence that is rationally related to the measures, while recognising the Parties' obligations regarding assessment of risk under Article 5 of the SPS Agreement.

3. Recognising the Parties' rights and obligations under the relevant provisions of the SPS Agreement, nothing in this Chapter shall be construed to prevent a Party from:

(a) establishing the level of protection it determines to be appropriate;

(b) establishing or maintaining an approval procedure that requires a risk analysis to be conducted before the Party grants a product access to its market; or

(c) adopting or maintaining a sanitary or phytosanitary measure on a provisional basis.

4. Each Party shall:

(a) ensure that its sanitary and phytosanitary measures do not arbitrarily or unjustifiably discriminate between Parties where identical or similar conditions prevail, including between its own territory and that of other Parties; and

(b) conduct its risk analysis in a manner that is documented and that provides interested persons and other Parties an opportunity to comment, in a manner to be determined by that Party.

5. Each Party shall ensure that each risk assessment it conducts is appropriate to the circumstances of the risk at issue and takes into account reasonably available and relevant scientific data, including qualitative and quantitative information.

6. When conducting its risk analysis, each Party shall:

(a) take into account relevant guidance of the WTO SPS Committee and international standards, guidelines and recommendations;

(b) consider risk management options that are not more trade restrictive5than required, including the facilitation of trade by not taking any measure, to achieve the level of protection that the Party has determined to be appropriate; and

(c) select a risk management option that is not more trade restrictive than required to achieve the sanitary or phytosanitary objective, taking into account technical and economic feasibility.

7. If an importing Party requires a risk analysis to evaluate a request from an exporting Party to authorise importation of a good of that exporting Party, the importing Party shall provide, on request of the exporting Party, an explanation of the information required for the risk assessment. On receipt of the required information from the exporting Party, the importing Party shall endeavour to facilitate the evaluation of the request for authorisation by scheduling work on this request in accordance with the procedures, policies, resources, and laws and regulations of the importing Party.

8. On request of the exporting Party, the importing Party shall inform the exporting Party of the progress of a specific risk analysis request, and of any delay that may occur during the process.

9. If the importing Party, as a result of a risk analysis, adopts a sanitary or phytosanitary measure that allows trade to commence or resume, the importing Party shall implement the measure within a reasonable period of time.

10. Without prejudice to Article 7.14 (Emergency Measures), no Party shall stop the importation of a good of another Party solely for the reason that the importing Party is undertaking a review of its sanitary or phytosanitary measure, if the importing Party permitted the importation of that good of the other Party when the review was initiated.

Article 7.10: Audits6

1. To determine an exporting Party's ability to provide required assurances and meet the sanitary and phytosanitary measures of the importing Party, each importing Party shall have the right, subject to this Article, to audit the exporting Party's competent authorities and associated or designated inspection systems. That audit may include an assessment of the competent authorities' control programmes, including: if appropriate, reviews of the inspection and audit programmes; and on-site inspections of facilities.

2. An audit shall be systems-based and designed to check the effectiveness of the regulatory controls of the competent authorities of the exporting Party.

3. In undertaking an audit, a Party shall take into account relevant guidance of the WTO SPS Committee and international standards, guidelines and recommendations.

4. Prior to the commencement of an audit, the importing Party and exporting Party involved shall discuss the rationale and decide: the objectives and scope of the audit; the criteria or requirements against which the exporting Party will be assessed; and the itinerary and procedures for conducting the audit.

5. The auditing Party shall provide the audited Party the opportunity to comment on the findings of the audit and take any such comments into account before the auditing Party makes its conclusions and takes any action. The auditing Party shall provide a report setting out its conclusions in writing to the audited Party within a reasonable period of time.

6. A decision or action taken by the auditing Party as a result of the audit shall be supported by objective evidence and data that can be verified, taking into account the auditing Party's knowledge of, relevant experience with, and confidence in, the audited Party. This objective evidence and data shall be provided to the audited Party on request.

7. The costs incurred by the auditing Party shall be borne by the auditing Party, unless both Parties decide otherwise.

8. The auditing Party and audited Party shall each ensure that procedures are in place to prevent the disclosure of confidential information that is acquired during the audit process.

Article 7.11: Import Checks

1. Each Party shall ensure that its import programmes are based on the risks associated with importations, and the import checks are carried out without undue delay.

2. A Party shall make available to another Party, on request, information on its import procedures and its basis for determining the nature and frequency of import checks, including the factors it considers to determine the risks associated with importations.

3. A Party may amend the frequency of its import checks as a result of experience gained through import checks or as a result of actions or discussions provided for in this Chapter.

4. An importing Party shall provide to another Party, on request, information regarding the analytical methods, quality controls, sampling procedures and facilities that the importing Party uses to test a good. The importing Party shall ensure that any testing is conducted using appropriate and validated methods in a facility that operates under a quality assurance programme that is consistent with international laboratory standards. The importing Party shall maintain physical or electronic documentation regarding the identification, collection, sampling, transportation and storage of the test sample, and the analytical methods used on the test sample.

5. An importing Party shall ensure that its final decision in response to a finding of non-conformity with the importing Party's sanitary or phytosanitary measure, is limited to what is reasonable and necessary, and is rationally related to the available science.

6. If an importing Party prohibits or restricts the importation of a good of another Party on the basis of an adverse result of an import check, the importing Party shall provide a notification about the adverse result to at least one of the following: the importer or its agent; the exporter; the manufacturer; or the exporting Party.

7. When the importing Party provides a notification pursuant to paragraph 6, it shall:

(a) include:

(i) the reason for the prohibition or restriction;

(ii) the legal basis or authorisation for the action; and

(iii) information on the status of the affected goods and, if appropriate, on their disposition;

(b) do so in a manner consistent with its laws, regulations and requirements as soon as possible and no later than seven days after the date of the decision to prohibit or restrict, unless the good is seized by a customs administration; and

(c) if the notification has not already been provided through anothe channel, transmit the notification by electronic means, if practicable.

8. An importing Party that prohibits or restricts the importation of a good of another Party on the basis of an adverse result of an import check shall provide an opportunity for a review of the decision and consider any relevant information submitted to assist in the review. The review request and information should be submitted to the importing Party within a reasonable period of time.

9. If an importing Party determines that there is a significant, sustained or recurring pattern of non-conformity with a sanitary or phytosanitary measure, the importing Party shall notify the exporting Party of the non-conformity.

10. On request, an importing Party shall provide to the exporting Party available information on goods from the exporting Party that were found not to conform to a sanitary or phytosanitary measure of the importing Party.

Article 7.12: Certification

1. The Parties recognise that assurances with respect to sanitary or phytosanitary requirements may be provided through means other than certificates and that different systems may be capable of meeting the same sanitary or phytosanitary objective.

2. If an importing Party requires certification for trade in a good, the Party shall ensure that the certification requirement is applied, in meeting the Party's sanitary or phytosanitary objectives, only to the extent necessary to protect human, animal or plant life or health.

3. In applying certification requirements, an importing Party shall take into account relevant guidance of the WTO SPS Committee and international standards, guidelines and recommendations.

4. An importing Party shall limit attestations and information it requires on the certificates to essential information that is related to the sanitary or phytosanitary objectives of the importing Party.

5. An importing Party should provide to another Party, on request, the rationale for any attestations or information that the importing Party requires to be included on a certificate.

6. The Parties may agree to work cooperatively to develop model certificates to accompany specific goods traded between the Parties, taking into account relevant guidance of the WTO SPS Committee and international standards, guidelines and recommendations.

7. The Parties shall promote the implementation of electronic certification and other technologies to facilitate trade.

Article 7.13: Transparency

1. The Parties recognise the value of sharing information about their sanitary and phytosanitary measures on an ongoing basis, and of providing interested persons and other Parties with the opportunity to comment on their proposed sanitary and phytosanitary measures.

2. In implementing this Article, each Party shall take into account relevant guidance of the WTO SPS Committee and international standards, guidelines and recommendations.

3. A Party shall notify a proposed sanitary or phytosanitary measure that may have an effect on the trade of another Party, including any that conforms to international standards, guidelines or recommendations, by using the WTO SPS notification submission system as a means of notifying the other Parties.

4. Unless urgent problems of human, animal or plant life or health protection arise or threaten to arise, or the measure is of a trade-facilitating nature, a Party shall normally allow at least 60 days for interested persons and other Parties to provide written comments on the proposed measure after it makes the notification under paragraph 3. If feasible and appropriate, the Party should allow more than 60 days. The Party shall consider any reasonable request from an interested person or another Party to extend the comment period. On request of another Party, the Party shall respond to the written comments of the other Party in an appropriate manner.

5. The Party shall make available to the public, by electronic means in an official journal or on a website, the proposed sanitary or phytosanitary measure notified under paragraph 3, the legal basis for the measure, and the written comments or a summary of the written comments that the Party has received from the public on the measure.

6. If a Party proposes a sanitary or phytosanitary measure which does not conform to an international standard, guideline or recommendation, the Party shall provide to another Party, on request, and to the extent permitted by the confidentiality and privacy requirements of the Party's law, the relevant documentation that the Party considered in developing the proposed measure, including documented and objective scientific evidence that is rationally related to the measure, such as risk assessments, relevant studies and expert opinions.

7. A Party that proposes to adopt a sanitary or phytosanitary measure shall discuss with another Party, on request and if appropriate and feasible, any scientific or trade concerns that the other Party may raise regarding the proposed measure and the availability of alternative, less trade-restrictive approaches for achieving the objective of the measure.

8. Each Party shall publish, preferably by electronic means, notices of final sanitary or phytosanitary measures in an official journal or website.

9. Each Party shall notify the other Parties of final sanitary or phytosanitary measures through the WTO SPS notification submission system. Each Party shall ensure that the text or the notice of a final sanitary or phytosanitary measure specifies the date on which the measure takes effect and the legal basis for the measure. A Party shall also make available to another Party, on request, and to the extent permitted by the confidentiality and privacy requirements of the Party's law, significant written comments and relevant documentation considered to support the measure that were received during the comment period.

10. If a final sanitary or phytosanitary measure is substantively altered from the proposed measure, a Party shall also include in the notice of the final sanitary or phytosanitary measure that it publishes, an explanation of:

(a) the objective and rationale of the measure and how the measure advances that objective and rationale; and

(b) any substantive revisions that it made to the proposed measure.

11. An exporting Party shall notify the importing Party through the contact points referred to in Article 7.6 (Competent Authorities and Contact Points) in a timely and appropriate manner:

(a) if it has knowledge of a significant sanitary or phytosanitary risk related to the export of a good from its territory;

(b) of urgent situations where a change in animal or plant health status in the territory of the exporting Party may affect current trade;

(c) of significant changes in the status of a regionalised pest or disease;

(d) of new scientific findings of importance which affect the regulatory response with respect to food safety, pests or diseases; and

(e) of significant changes in food safety, pest or disease management, control or eradication policies or practices that may affect current trade.

12. If feasible and appropriate, a Party should provide an interval of more than six months between the date it publishes a final sanitary or phytosanitary measure and the date on which the measure takes effect, unless the measure is intended to address an urgent problem of human, animal or plant life or health protection or the measure is of a trade-facilitating nature.

13. A Party shall provide to another Party, on request, all sanitary or phytosanitary measures related to the importation of a good into that Party's territory.

Article 7.14: Emergency Measures

1. If a Party adopts an emergency measure that is necessary for the protection of human, animal or plant life or health, the Party shall promptly notify the other Parties of that measure through the primary representative and the relevant contact point referred to in Article 7.6 (Competent Authorities and Contact Points). The Party that adopts the emergency measure shall take into consideration any information provided by other Parties in response to the notification.

2. If a Party adopts an emergency measure, it shall review the scientific basis of that measure within six months and make available the results of the review to any Party on request. If the emergency measure is maintained after the review, because the reason for its adoption remains, the Party should review the measure periodically.

Article 7.15: Cooperation

1. The Parties shall explore opportunities for further cooperation, collaboration and information exchange between the Parties on sanitary and phytosanitary matters of mutual interest, consistent with this Chapter. Those opportunities may include trade facilitation initiatives and technical assistance. The Parties shall cooperate to facilitate the implementation of this Chapter.

2. The Parties shall cooperate and may jointly identify work on sanitary and phytosanitary matters with the goal of eliminating unnecessary obstacles to trade between the Parties.

Article 7.16: Information Exchange

A Party may request information from another Party on a matter arising under this Chapter. A Party that receives a request for information shall endeavour to provide available information to the requesting Party within a reasonable period of time, and if possible, by electronic means.

Article 7.17: Cooperative Technical Consultations

1. If a Party has concerns regarding any matter arising under this Chapter with another Party, it shall endeavour to resolve the matter by using the administrative procedures that the other Party's competent authority has available. If the relevant Parties have bilateral or other mechanisms available to address the matter, the Party raising the matter shall endeavour to resolve the matter through those mechanisms, if it considers that it is appropriate to do so. A Party may have recourse to the Cooperative Technical Consultations (CTC) set out in paragraph 2 at any time it considers that the continued use of the administrative procedures or bilateral or other mechanisms would not resolve the matter.

2. One or more Parties (requesting Party) may initiate CTC with another Party (responding Party) to discuss any matter arising under this Chapter that the requesting Party considers may adversely affect its trade by delivering a request to the primary representative of the responding Party. The request shall be in writing and identify the reason for the request, including a description of the requesting Party's concerns about the matter, and set out the provisions of this Chapter that relate to the matter.

3. Unless the requesting Party and the responding Party (the consulting Parties) agree otherwise, the responding Party shall acknowledge the request in writing within seven days of the date of its receipt.

4. Unless the consulting Parties agree otherwise, the consulting Parties shall meet within 30 days of the responding Party's acknowledgement of the request to discuss the matter identified in the request, with the aim of resolving the matter within 180 days of the request if possible. The meeting shall be in person or by electronic means.

5. The consulting Parties shall ensure the appropriate involvement of relevant trade and regulatory agencies in meetings held pursuant to this Article.

6. All communications between the consulting Parties in the course of CTC, as well as all documents generated for CTC, shall be kept confidential unless the consulting Parties agree otherwise and without prejudice to the rights and obligations of any Party under this Agreement, the WTO Agreement or any other international agreement to which it is a party.

7. The requesting Party may cease CTC proceedings under this Article and have recourse to dispute settlement under Chapter 28 (Dispute Settlement) if:

(a) the meeting referred to in paragraph 4 does not take place within 37 days of the date of the request, or such other timeframe as the consulting Parties may agree under paragraphs 3 and 4; or

(b) the meeting referred to in paragraph 4 has been held.

8. No Party shall have recourse to dispute settlement under Chapter 28 (Dispute Settlement) for a matter arising under this Chapter without first seeking to resolve the matter through CTC in accordance with this Article.

Article 7.18: Dispute Settlement

1. Unless otherwise provided in this Chapter, Chapter 28 (Dispute Settlement) shall apply to this Chapter, subject to the following:

(a) with respect to Article 7.8 (Equivalence), Article 7.10 (Audits) and Article 7.11 (Import Checks), Chapter 28 (Dispute Settlement) shall apply with respect to a responding Party as of one year after the date of entry into force of this Agreement for that Party; and

(b) with respect to Article 7.9 (Science and Risk Analysis), Chapter 28 (Dispute Settlement) shall apply with respect to a responding Party as of two years after the date of entry into force of this Agreement for that Party.

2. In a dispute under this Chapter that involves scientific or technical issues, a panel should seek advice from experts chosen by the panel in consultation with the Parties involved in the dispute. To this end, the panel may, if it deems appropriate, establish an advisory technical experts group, or consult the relevant international standard setting organisations, at the request of either Party to the dispute or on its own initiative.


CHAPTER 8

TECHNICAL BARRIERS TO TRADE

Article 8.1: Definitions

1. The definitions of the terms used in this Chapter contained in Annex 1 of the TBT Agreement, including the chapeau and explanatory notes of Annex 1, are incorporated into this Chapter and shall form part of this Chapter, mutatis mutandis.

2. In addition, for the purposes of this Chapter:

consular transactions means requirements that products of a Party intended for export to the territory of another Party must first be submitted to the supervision of the consul of the importing Party in the territory of the exporting Party for the purpose of obtaining consular invoices or consular visas for conformity assessment documentation;

marketing authorisation means the process or processes by which a Party approves or registers a product in order to authorise its marketing, distribution or sale in the Party's territory. The process or processes may be described in a Party's laws or regulations in various ways, including "marketing authorisation", "authorisation", "approval", "registration", "sanitary authorisation", "sanitary registration" and "sanitary approval" for a product. Marketing authorisation does not include notification procedures;

mutual recognition agreement means a binding government-to-government agreement for recognition of the results of conformity assessment conducted against the appropriate technical regulations or standards in one or more sectors, including government-to-government agreements to implement the APEC Mutual Recognition Arrangement for Conformity Assessment of Telecommunications Equipment of May 8, 1998 and the Electrical and Electronic Equipment Mutual Recognition Arrangement of July 7, 1999 and other agreements that provide for the recognition of conformity assessment conducted against appropriate technical regulations or standards in one or more sectors;

mutual recognition arrangement means an international or regional arrangement (including a multilateral recognition arrangement) between accreditation bodies recognising the equivalence of accreditation systems (based on peer review) or between conformity assessment bodies recognising the results of conformity assessment;

post-market surveillance means procedures taken by a Party after a product has been placed on its market to enable the Party to monitor or address compliance with the Party's domestic requirements for products;

TBT Agreement means the WTO Agreement on Technical Barriers to Trade, as may be amended; and

verify means to take action to confirm the veracity of individual conformity assessment results, such as requesting information from the conformity assessment body or the body that accredited, approved, licensed or otherwise recognised the conformity assessment body, but does not include requirements that subject a product to conformity assessment in the territory of the importing Party that duplicate the conformity assessment procedures already conducted with respect to the product in the territory of the exporting Party or a third party, except on a random or infrequent basis for the purpose of surveillance, or in response to information indicating non-compliance.

Article 8.2: Objective

The objective of this Chapter is to facilitate trade, including by eliminating unnecessary technical barriers to trade, enhancing transparency, and promoting greater regulatory cooperation and good regulatory practice.

Article 8.3: Scope

1. This Chapter shall apply to the preparation, adoption and application of all technical regulations, standards and conformity assessment procedures of central level of government bodies (and, where explicitly provided for, technical regulations, standards and conformity assessment procedures of government bodies at the level directly below that of the central level of government) that may affect trade in goods between the Parties, except as provided in paragraphs 4 and 5.

2. Each Party shall take reasonable measures that are within its authority to encourage observance by regional or local government bodies, as the case may be, on the level directly below that of the central level of government within its territory which are responsible for the preparation, adoption and application of technical regulations, standards and conformity assessment procedures, of Article 8.5 (International Standards, Guides and Recommendations), Article 8.6 (Conformity Assessment), Article 8.8 (Compliance Period for Technical Regulations and Conformity Assessment Procedures) and each of the Annexes to this Chapter.

3. All references in this Chapter to technical regulations, standards and conformity assessment procedures shall be construed to include any amendments to them and any addition to the rules or the product coverage of those technical regulations, standards and procedures, except amendments and additions of an insignificant nature.

4. This Chapter shall not apply to technical specifications prepared by a governmental entity for its production or consumption requirements. These specifications are covered by Chapter 15 (Government Procurement).

5. This Chapter shall not apply to sanitary and phytosanitary measures. These are covered by Chapter 7 (Sanitary and Phytosanitary Measures).

6. For greater certainty, nothing in this Chapter shall prevent a Party from adopting or maintaining technical regulations, standards or conformity assessment procedures in accordance with its rights and obligations under this Agreement, the TBT Agreement and any other relevant international agreement.

Article 8.4: Incorporation of Certain Provisions of the TBT Agreement

1. The following provisions of the TBT Agreement are incorporated into and made part of this Agreement, mutatis mutandis:

(a) Articles 2.1, 2.2, 2.4, 2.5, 2.9, 2.10, 2.11, 2.12;

(b) Articles 5.1, 5.2, 5.3, 5.4, 5.6, 5.7, 5.8, 5.9; and

(c) paragraphs D, E and F of Annex 3.

2. No Party shall have recourse to dispute settlement under Chapter 28 (Dispute Settlement) for a dispute that exclusively alleges a violation of the provisions of the TBT Agreement incorporated under paragraph 1.

Article 8.5: International Standards, Guides and Recommendations

1. The Parties recognise the important role that international standards, guides and recommendations can play in supporting greater regulatory alignment, good regulatory practice and reducing unnecessary barriers to trade.

2. In this respect, and further to Articles 2.4 and 5.4 and Annex 3 of the TBT Agreement, to determine whether there is an international standard, guide or recommendation within the meaning of Articles 2 and 5 and Annex 3 of the TBT Agreement, each Party shall apply the Decisions and Recommendations adopted by the WTO Committee on Technical Barriers to Trade Since 1 January 1995 (G/TBT/1/Rev.12), as may be revised, issued by the WTO Committee on Technical Barriers to Trade.

3. The Parties shall cooperate with each other, when feasible and appropriate, to ensure that international standards, guides and recommendations that are likely to become a basis for technical regulations and conformity assessment procedures do not create unnecessary obstacles to international trade.

Article 8.6: Conformity Assessment

1. Further to Article 6.4 of the TBT Agreement, each Party shall accord to conformity assessment bodies located in the territory of another Party treatment no less favourable than that it accords to conformity assessment bodies located in its own territory or in the territory of any other Party. In order to ensure that it accords such treatment, each Party shall apply the same or equivalent procedures, criteria and other conditions to accredit, approve, license or otherwise recognise conformity assessment bodies located in the territory of another Party that it may apply to conformity assessment bodies in its own territory.

2. Further to Article 6.4 of the TBT Agreement, if a Party maintains procedures, criteria or other conditions as set out in paragraph 1 and requires test results, certifications or inspections as positive assurance that a product conforms to a technical regulation or standard, the Party:

(a) shall not require the conformity assessment body that tests or certifies the product, or the conformity assessment body conducting an inspection, to be located within its territory;

(b) shall not impose requirements on conformity assessment bodies located outside its territory that would effectively require those conformity assessment bodies to operate an office in that Party's territory; and

(c) shall permit conformity assessment bodies in other Parties' territories to apply to the Party for a determination that they comply with any procedures, criteria and other conditions the Party requires to deem them competent or to otherwise approve them to test or certify the product or conduct an inspection.

3. Paragraphs 1 and 2 shall not preclude a Party from undertaking conformity assessment in relation to a specific product solely within specified government bodies located in its own territory or in another Party's territory, in a manner consistent with its obligations under the TBT Agreement.

4. If a Party undertakes conformity assessment under paragraph 3, and further to Articles 5.2 and 5.4 of the TBT Agreement concerning limitation on information requirements, the protection of legitimate commercial interests and the adequacy of review procedures, the Party shall, on the request of another Party, explain:

(a) how the information required is necessary to assess conformity and determine fees;

(b) how the Party ensures that the confidentiality of the information required is respected in a manner that ensures legitimate commercial interests are protected; and

(c) the procedure to review complaints concerning the operation of the conformity assessment procedure and to take corrective action when a complaint is justified.

5. Paragraphs 1 and 2(c) shall not preclude a Party from using mutual recognition agreements to accredit, approve, license or otherwise recognise conformity assessment bodies located outside its territory.

6. Nothing in paragraphs 1, 2 and 5 precludes a Party from verifying the results of conformity assessment procedures undertaken by conformity assessment bodies located outside its territory.

7. Further to paragraph 6, in order to enhance confidence in the continued reliability of conformity assessment results from the Parties' respective territories, a Party may request information on matters pertaining to conformity assessment bodies located outside its territory.

8. Further to Article 9.1 of the TBT Agreement, a Party shall consider adopting measures to approve conformity assessment bodies that have accreditation for the technical regulations or standards of the importing Party, by an accreditation body that is a signatory to an international or regional mutual recognition arrangement. 1 The Parties recognise that these arrangements can address the key considerations in approving conformity assessment bodies, including technical competence, independence, and the avoidance of conflicts of interest.

9. Further to Article 9.2 of the TBT Agreement no Party shall refuse to accept conformity assessment results from a conformity assessment body or take actions that have the effect of, directly or indirectly, requiring or encouraging another Party or person to refuse to accept conformity assessment results from a conformity assessment body because the accreditation body that accredited the conformity assessment body:

(a) operates in the territory of a Party where there is more than one accreditation body;

(b) is a non-governmental body;

(c) is domiciled in the territory of a Party that does not maintain a procedure for recognising accreditation bodies, provided that the accreditation body is recognised internationally, consistent with the provisions in paragraph 8;

(d) does not operate an office in the Party's territory; or

(e) is a for-profit entity.

10. Nothing in paragraph 9 prohibits a Party from refusing to accept conformity assessment results from a conformity assessment body on grounds other than those set out in paragraph 9 if that Party can substantiate those grounds for the refusal, and that refusal is not inconsistent with the TBT Agreement and this Chapter.

11. A Party shall publish, preferably by electronic means, any procedures, criteria and other conditions that it may use as the basis for determining whether conformity assessment bodies are competent to receive accreditation, approval, licensing or other recognition, including accreditation, approval, licensing or other recognition granted pursuant to a mutual recognition agreement.

12. If a Party:

(a) accredits, approves, licenses or otherwise recognises a body assessing conformity with a particular technical regulation or standard in its territory, and refuses to accredit, approve, license or otherwise recognise a body assessing conformity with that technical regulation or standard in the territory of another Party; or

(b) declines to use a mutual recognition arrangement, it shall, on request of the other Party, explain the reasons for its decision.

13. If a Party does not accept the results of a conformity assessment procedure conducted in the territory of another Party, it shall, on the request of the other Party, explain the reasons for its decision.

14. Further to Article 6.3 of the TBT Agreement, if a Party declines the request of another Party to enter into negotiations to conclude an agreement for mutual recognition of the results of each other's conformity assessment procedures, it shall, on request of that other Party, explain the reasons for its decision.

15. Further to Article 5.2.5 of the TBT Agreement any conformity assessment fees imposed by a Party shall be limited to the approximate cost of services rendered.

16. No Party shall require consular transactions, including related fees and charges, in connection with conformity assessment.

Article 8.7: Transparency

1. Each Party shall allow persons of another Party to participate in the development of technical regulations, standards and conformity assessment procedures by its central government bodies on terms no less favourable than those that it accords to its own persons.

2. Each Party is encouraged to consider methods to provide additional transparency in the development of technical regulations, standards and conformity assessment procedures, including through the use of electronic tools and public outreach or consultations.

3. If appropriate, each Party shall encourage non-governmental bodies in its territory to observe the obligations in paragraphs 1 and 2.

4. Each Party shall publish all proposals for new technical regulations and conformity assessment procedures and proposals for amendments to existing technical regulations and conformity assessment procedures, and all new final technical regulations and conformity assessment procedures and final amendments to existing technical regulations and conformity assessment procedures, of central government bodies.

5. A Party may determine the form of proposals for technical regulations and conformity assessment procedures, which may take the form of: policy proposals; discussion documents; summaries of proposed technical regulations and conformity assessment procedures; or the draft text of proposed technical regulations and conformity assessment procedures. Each Party shall ensure that its proposals contain sufficient detail about the likely content of the proposed technical regulations and conformity assessment procedures to adequately inform interested persons and other Parties about whether and how their trade interests might be affected.

6. Each Party shall publish preferably by electronic means, in a single official journal or website all proposals for new technical regulations and conformity assessment procedures and proposals for amendments to existing technical regulations and conformity assessment procedures, and all new final technical regulations and conformity assessment procedures and final amendments to existing technical regulations and conformity assessment procedures, of central government bodies, that a Party is required to notify or publish under the TBT Agreement or this Chapter, and that may have a significant effect on trade.

7. Each Party shall take such reasonable measures as may be available to it to ensure that all proposals for new technical regulations and conformity assessment procedures and proposals for amendments to existing technical regulations and conformity assessment procedures, and all new final technical regulations and conformity assessment procedures and final amendments to existing technical regulations and conformity assessment procedures, of regional or local governments, as the case may be, on the level directly below that of the central level of government, are published.

8. Each Party shall ensure that all new final technical regulations and conformity assessment procedures and final amendments to existing technical regulations and conformity assessment procedures, and to the extent practicable, all proposals for new technical regulations and conformity assessment procedures and proposals for amendments to existing technical regulations and conformity assessment procedures, of regional or local governments on the level directly below that of the central level of government are accessible through official websites or journals, preferably consolidated into a single website.

9. Each Party shall notify proposals for new technical regulations and conformity assessment procedures that are in accordance with the technical content of relevant international standards, guides or recommendations, if any, and that may have a significant effect on trade, according to the procedures established under Article 2.9 or 5.6 of the TBT Agreement.

10. Notwithstanding paragraph 9, if urgent problems of safety, health, environmental protection or national security arise or threaten to arise for a Party, that Party may notify a new technical regulation or conformity assessment procedure that is in accordance with the technical content of relevant international standards, guides or recommendations, if any, upon the adoption of that regulation or procedure, according to the procedures established under Article 2.10 or 5.7 of the TBT Agreement.

11. Each Party shall endeavour to notify proposals for new technical regulations and conformity assessment procedures of regional or local governments, as the case may be, on the level directly below that of the central level of government that are in accordance with the technical content of relevant international standards, guides and recommendations, if any, and that may have a significant effect on trade according to the procedures established under Article 2.9 or 5.6 of the TBT Agreement.

12. For the purposes of determining whether a proposed technical regulation or conformity assessment procedure may have a significant effect on trade and should be notified in accordance with Article 2.9, 2.10, 3.2, 5.6, 5.7 or 7.2 of the TBT Agreement or this Chapter, a Party shall consider, among other things, the relevant Decisions and Recommendations Adopted by the WTO Committee on Technical Barriers to Trade Since 1 January 1995 (G/TBT/1/Rev. 12), as may be revised.

13. A Party that publishes a notice and that files a notification in accordance with Article 2.9, 3.2, 5.6 or 7.2 of the TBT Agreement or this Chapter shall:

(a) include in the notification an explanation of the objectives of the proposal and how it would address those objectives; and

(b) transmit the notification and the proposal electronically to the other Parties through their enquiry points established in accordance with Article 10 of the TBT Agreement, at the same time as it notifies WTO Members.

14. Each Party shall normally allow 60 days from the date it transmits a proposal under paragraph 13 for another Party or an interested person of another Party to provide comments in writing on the proposal. A Party shall consider any reasonable request from another Party or an interested person of another Party to extend the comment period. A Party that is able to extend a time limit beyond 60 days, for example 90 days, is encouraged to do so.

15. Each Party is encouraged to provide sufficient time between the end of the comment period and the adoption of the notified technical regulation or conformity assessment procedure, for its consideration of, and preparation of responses to, the comments received.

16. Each Party shall endeavour to notify the final text of a technical regulation or conformity assessment procedure at the time the text is adopted or published, as an addendum to the original notification of the proposed measure filed under Article 2.9, 3.2, 5.6 or 7.2 of the TBT Agreement or this Chapter.

17. A Party that files a notification in accordance with Article 2.10 or 5.7 of the TBT Agreement and this Chapter shall, at the same time, transmit the notification and text of the technical regulation or conformity assessment procedure electronically to the other Parties through the enquiry points referred to in paragraph 13(b).

18. No later than the date of publication of a final technical regulation or conformity assessment procedure that may have a significant effect on trade, each Party shall, preferably electronically:

(a) make publicly available an explanation of the objectives and how the final technical regulation or conformity assessment procedure achieves them;

(b) provide as soon as possible, but no later than 60 days after receiving a request from another Party, a description of alternative approaches, if any, that the Party considered in developing the final technical regulation or conformity assessment procedure and the merits of the approach that the Party selected;5

(c) make publicly available the Party's responses to significant or substantive issues presented in comments received on the proposal for the technical regulation or conformity assessment procedure; and

(d) provide as soon as possible, but no later than 60 days after receiving a request from another Party, a description of significant revisions, if any, that the Party made to the proposal for the technical regulation or conformity assessment procedure, including those made in response to comments.

19. Further to paragraph J of Annex 3 of the TBT Agreement, each Party shall ensure that its central government standardising body's work programme, containing the standards it is currently preparing and the standards it has adopted, is available through the central government standardising body's website or the website referred to in paragraph 6.

Article 8.8: Compliance Period for Technical Regulations and Conformity Assessment Procedures

1. For the purposes of applying Articles 2.12 and 5.9 of the TBT Agreement the term "reasonable interval" means normally a period of not less than six months, except when this would be ineffective in fulfilling the legitimate objectives pursued by the technical regulation or by the requirements concerning the conformity assessment procedure.

2. If feasible and appropriate, each Party shall endeavour to provide an interval of more than six months between the publication of final technical regulations and conformity assessment procedures and their entry into force.

3. In addition to paragraphs 1 and 2, in setting a "reasonable interval" for a specific technical regulation or conformity assessment procedure, each Party shall ensure that it provides suppliers with a reasonable period of time, under the circumstances, to be able to demonstrate the conformity of their goods with the relevant requirements of the technical regulation or standard by the date of entry into force of the specific technical regulation or conformity assessment procedure. In doing so, each Party shall endeavour to take into account the resources available to suppliers.

Article 8.9: Cooperation and Trade Facilitation

1. Further to Articles 5, 6 and 9 of the TBT Agreement, the Parties acknowledge that a broad range of mechanisms exist to facilitate the acceptance of conformity assessment results. In this regard, a Party may:

(a) implement mutual recognition of the results of conformity assessment procedures performed by bodies located in its territory and another Party's territory with respect to specific technical regulations;

(b) recognise existing regional and international mutual recognition arrangements between or among accreditation bodies or conformity assessment bodies;

(c) use accreditation to qualify conformity assessment bodies, particularly international systems of accreditation;

(d) designate conformity assessment bodies or recognise another Party's designation of conformity assessment bodies;

(e) unilaterally recognise the results of conformity assessment procedures performed in another Party's territory; and

(f) accept a supplier's declaration of conformity.

2. The Parties recognise that a broad range of mechanisms exist to support greater regulatory alignment and to eliminate unnecessary technical barriers to trade in the region, including:

(a) regulatory dialogue and cooperation to, among other things:

(i) exchange information on regulatory approaches and practices;

(ii) promote the use of good regulatory practices to improve the efficiency and effectiveness of technical regulations, standards and conformity assessment procedures;

(iii) provide technical advice and assistance, on mutually agreed terms and conditions, to improve practices related to the development, implementation and review of technical regulations, standards, conformity assessment procedures and metrology; or

(iv) provide technical assistance and cooperation, on mutually agreed terms and conditions, to build capacity and support the implementation of this Chapter;

(b) greater alignment of national standards with relevant international standards, except where inappropriate or ineffective;

(c) facilitation of the greater use of relevant international standards, guides and recommendations as the basis for technical regulations and conformity assessment procedures; and

(d) promotion of the acceptance of technical regulations of another Party as equivalent.

3. With respect to the mechanisms listed in paragraphs 1 and 2, the Parties recognise that the choice of the appropriate mechanism in a given regulatory context depends on a variety of factors, such as the product and sector involved, the volume and direction of trade, the relationship between Parties' respective regulators, the legitimate objectives pursued and the risks of non-fulfilment of those objectives.

4. The Parties shall strengthen their exchange and collaboration on mechanisms to facilitate the acceptance of conformity assessment results, to support greater regulatory alignment and to eliminate unnecessary technical barriers to trade in the region.

5. A Party shall, on request of another Party, give due consideration to any sector-specific proposal for cooperation under this Chapter.

6. Further to Article 2.7 of the TBT Agreement, a Party shall, on request of another Party, explain the reasons why it has not accepted a technical regulation of that Party as equivalent.

7. The Parties shall encourage cooperation between their respective organisations responsible for standardisation, conformity assessment, accreditation and metrology, whether they are public or private, with a view to addressing issues covered by this Chapter.

Article 8.10: Information Exchange and Technical Discussions

1. A Party may request another Party to provide information on any matter arising under this Chapter. A Party receiving a request under this paragraph shall provide that information within a reasonable period of time, and if possible, by electronic means.

2. A Party may request technical discussions with another Party with the aim of resolving any matter that arises under this Chapter.

3. For greater certainty, with respect to technical regulations or conformity assessment procedures of regional or local governments, as the case may be, on the level directly below that of the central government that may have a significant effect on trade, a Party may request technical discussions with another Party regarding those matters.

4. The relevant Parties shall discuss the matter raised within 60 days of the date of the request. If a requesting Party considers that the matter is urgent, it may request that any discussions take place within a shorter time frame. The responding Party shall give positive consideration to that request.

5. The Parties shall endeavour to resolve the matter as expeditiously as possible, recognising that the time required to resolve a matter will depend on a variety of factors, and that it may not be possible to resolve every matter through technical discussions.

6. Unless the Parties that participate in the technical discussions agree otherwise, the discussions and any information exchanged in the course of the discussions shall be confidential and without prejudice to the rights and obligations of the participating Parties under this Agreement, the WTO Agreement or any other agreement to which both Parties are party.

7. Requests for information or technical discussions and communications shall be conveyed through the respective contact points designated pursuant to Article 27.5 (Contact Points).

Article 8.11: Committee on Technical Barriers to Trade

1. The Parties hereby establish a Committee on Technical Barriers to Trade (Committee), composed of government representatives of each Party.

2. Through the Committee, the Parties shall strengthen their joint work in the fields of technical regulations, standards and conformity assessment procedures with a view to facilitating trade between the Parties.

3. The Committee's functions may include:

(a) monitoring the implementation and operation of this Chapter, including any other commitments agreed under this Chapter, and identifying any potential amendments to or interpretations of those commitments pursuant to Chapter 27 (Administrative and Institutional Provisions);

(b) monitoring any technical discussions on matters that arise under this Chapter requested pursuant to paragraph 2 of Article 8.10 (Information Exchange and Technical Discussions);

(c) deciding on priority areas of mutual interest for future work under this Chapter and considering proposals for new sector-specific initiatives or other initiatives;

(d) encouraging cooperation between the Parties in matters that pertains to this Chapter, including the development, review or modification of technical regulations, standards and conformity assessment procedures;

(e) encouraging cooperation between non-governmental bodies in the Parties' territories, as well as cooperation between governmental and non-governmental bodies in the Parties' territories in matters that pertains to this Chapter;

(f) facilitating the identification of technical capacity needs;

(g) encouraging the exchange of information between the Parties and their relevant non-governmental bodies, if appropriate, to develop common approaches regarding matters under discussion in non governmental, regional, plurilateral and multilateral bodies or systems that develop standards, guides, recommendations, policies or other procedures relevant to this Chapter;

(h) encouraging, on request of a Party, the exchange of information between the Parties regarding specific technical regulations, standards and conformity assessment procedures of non-Parties as well as systemic issues, with a view to fostering a common approach;

(i) taking any other steps the Parties consider will assist them in implementing this Chapter and the TBT Agreement;

(j) reviewing this Chapter in light of any developments under the TBT Agreement, and developing recommendations for amendments to this Chapter in light of those developments; and

(k) reporting to the Commission on the implementation and operation of this Chapter.

4. The Committee may establish working groups to carry out its functions.

5. To determine what activities the Committee will undertake, the Committee shall consider work that is being undertaken in other fora, with a view to ensuring that any activities undertaken by the Committee do not unnecessarily duplicate that work.

6. The Committee shall meet within one year of the date of entry into force of this Agreement and thereafter as decided by the Parties.

Article 8.12: Contact Points

1. Each Party shall designate and notify a contact point for matters arising under this Chapter, in accordance with Article 27.5 (Contact Points).

2. A Party shall promptly notify the other Parties of any change of its contact point or the details of the relevant officials.

3. The responsibilities of each contact point shall include:

(a) communicating with the other Parties' contact points, including facilitating discussions, requests and the timely exchange of information on matters arising under this Chapter;

(b) communicating with and coordinating the involvement of relevant government agencies, including regulatory authorities, in its territory on relevant matters pertaining to this Chapter;

(c) consulting and if appropriate, coordinating with interested persons in its territory on relevant matters pertaining to this Chapter; and

(d) carrying out any additional responsibilities specified by the Committee.

Article 8.13: Annexes

1. The scope of the Annexes on Pharmaceuticals, Cosmetics, Medical Devices and Proprietary Formulas for Prepackaged Foods and Food Additives is set out in each respective Annex. The other Annexes to this Chapter have the same scope as that set out in Article 8.3 (Scope).

2. The rights and obligations set out in each Annex to this Chapter shall apply only with respect to the sector specified in that Annex, and shall not affect any Party's rights or obligations under any other Annex.

3. Unless the Parties agree otherwise, no later than five years after the date of entry into force of this Agreement and thereafter at least once every five years, the Committee shall:

(a) review the implementation of the Annexes, with a view to strengthening or improving them and if appropriate, make recommendations to enhance alignment of the Parties' respective technical regulations, standards and conformity assessment procedures in the sectors covered by the Annexes; and

(b) consider whether the development of Annexes concerning other sectors would further the objectives of this Chapter or the Agreement and decide whether to recommend to the Commission that the Parties initiate negotiations to conclude Annexes covering those sectors.


ANNEX 8-A

WINE AND DISTILLED SPIRITS

1. This Annex shall apply to wine and distilled spirits.

2. For the purposes of this Annex:

container means any bottle, barrel, cask or other closed receptacle, irrespective of size or of the material from which it is made, used for the retail sale of wine or distilled spirits;

distilled spirits means a potable alcoholic distillate, including spirits of wine, whiskey, rum, brandy, gin, tequila, mezcal and all dilutions or mixtures of those spirits for consumption;

label means any brand, mark, pictorial or other descriptive matter that is written, printed, stencilled, marked, embossed or impressed on, or firmly affixed to the primary container of wine or distilled spirits;

oenological practices means winemaking materials, processes, treatments and techniques, but does not include labelling, bottling or packaging for final sale;

single field of vision means any part of the surface of a primary container, excluding its base and cap, that can be seen without having to turn the container;

supplier means a producer, importer, exporter, bottler or wholesaler; and

wine means a beverage that is produced by the complete or partial alcoholic fermentation exclusively of fresh grapes, grape must, or products derived from fresh grapes in accordance with oenological practices that the country in which the wine is produced authorises under its laws and regulations.

3. Each Party shall make information about its laws and regulations concerning wine and distilled spirits publicly available.

4. A Party may require a supplier to ensure that any statement required by that Party to be placed on a wine or distilled spirits label is:

(a) clear, specific, truthful, accurate and not misleading to the consumer; and

(b) legible to the consumer; and that such labels be firmly affixed.

5. If a Party requires a supplier to indicate information on a distilled spirits label, the Party shall permit the supplier to indicate that information on a supplementary label that is affixed to the distilled spirits container. Each Party shall permit a supplier to affix the supplementary label on the container of the imported distilled spirits after importation but prior to offering the product for sale in the Party's territory, and may require that the supplier affix the supplementary label prior to release from customs. For greater certainty, a Party may require that the information indicated on a supplementary label meet the requirements in paragraph 4.

6. Each Party shall permit the alcoholic content by volume indicated on a wine or distilled spirits label to be expressed by alcohol by volume (alc/vol), for example 12% alc/vol or alc12%vol, and to be indicated in percentage terms to a maximum of one decimal point, for example 12.1%.

7. Each Party shall permit suppliers to use the term "wine" as a product name. A Party may require a supplier to indicate additional information on a wine label concerning the type, category, class or classification of the wine.

8. With respect to wine labels, each Party shall permit the information set out in subparagraphs 10(a) through (d) to be presented in a single field of vision for a container of wine. If this information is presented in a single field of vision, then the Party's requirements with respect to placement of this information are

satisfied. A Party shall accept any of the information that appears outside a single field of vision if that information satisfies that Party's laws, regulations and requirements.

9. Notwithstanding paragraph 8, a Party may require net contents to be displayed on the principal display panel for a subset of less commonly used container sizes if specifically required by that Party's laws or regulations.

10. If a Party requires a wine label to indicate information other than:

(a) product name;

(b) country of origin;

(c) net contents; or

(d) alcohol content,

it shall permit the supplier to indicate the information on a supplementary label affixed to the wine container. A Party shall permit the supplier to affix the supplementary label on the container of the imported wine after importation but prior to offering the product for sale in the Party's territory, and may require that the supplier affix the supplementary label prior to release from customs. For greater certainty, a Party may require that information on a supplementary label meet the requirements set out in paragraph 4.

11. For the purposes of paragraphs 4, 5 and 10, if there is more than one label on a container of imported wine or distilled spirits, a Party may require that each label be visible and not obscure mandatory information on another label.

12. If a Party has more than one official language, it may require that information on a wine or distilled spirits label appear in equal prominence in each official language.

13. Each Party shall permit a supplier to place a lot identification code on a wine or distilled spirits container, if the code is clear, specific, truthful, accurate and not misleading, and shall permit the supplier to determine:

(a) where to place the lot identification code on the container, provided that the code does not cover up essential information printed on the label; and

(b) the specific font size, readable phrasing and formatting for the code provided that the lot identification code is legible by physical or electronic means.

14. A Party may impose penalties for the removal or deliberate defacement of any lot identification code provided by the supplier and placed on the container.

15. No Party shall require a supplier to indicate any of the following information on a wine or distilled spirits container, labels or packaging:

(a) date of production or manufacture;

(b) date of expiration;

(c) date of minimum durability; or

(d) sell by date,

except that a Party may require a supplier to indicate a date of minimum durability or expiration on products7 that could have a shorter date of minimum durability or expiration than would normally be expected by the consumer because of: their packaging or container, for example bag-in-box wines or individual serving size wines; or the addition of perishable ingredients.

16. No Party shall require a supplier to place a translation of a trademark or trade name on a wine or distilled spirits container, label or packaging.

17. No Party shall prevent imports of wine from other Parties solely on the basis that the wine label includes the following descriptors or adjectives describing the wine or relating to wine-making: chateau, classic, clos, cream, crusted/crusting, fine, late bottled vintage, noble, reserve, ruby, special reserve, solera, superior, sur lie, tawny, vintage or vintage character. This paragraph shall not apply to a Party that has entered into an agreement with another country or group of countries no later than February 2003 that requires the Party to restrict the use of such terms on labels of wine sold in its territory.

18. No Party shall require a supplier to disclose an oenological practice on a wine label or container except to meet a legitimate human health or safety objective with respect to that oenological practice.

19. Each Party shall permit wine to be labelled as Icewine, ice wine, ice-wine or a similar variation of those terms, only if the wine is made exclusively from grapes naturally frozen on the vine.

20. Each Party shall endeavour to base its quality and identity requirements for any specific type, category, class or classification of distilled spirits solely on minimum ethyl alcohol content and the raw materials, added ingredients and production procedures used to produce that specific type, category, class or classification of distilled spirits.

21. No Party shall require imported wine or distilled spirits to be certified by an official certification body of the Party in whose territory the wine or distilled spirits were produced or by a certification body recognised by the Party in whose territory the wine or distilled spirits were produced regarding:

(a) vintage, varietal and regional claims for wine; or

(b) raw materials and production processes for distilled spirits, except that the Party may require that wine or distilled spirits be certified regarding (a) or (b) if the Party in whose territory the wine or distilled spirits were produced requires that certification, that wine be certified regarding (a) if the Party has a reasonable and legitimate concern about a vintage, varietal or regional claim for wine, or that distilled spirits be certified regarding (b) if certification is necessary to verify claims such as age, origin or standards of identity.

22. If a Party deems that certification of wine is necessary to protect human health or safety or to achieve other legitimate objectives, that Party shall consider the Codex Alimentarius Guidelines for Design, Production, Issuance and Use of Generic Official Certificates (CAC/GL 38-2001), in particular the use of the generic model official certificate, as amended from time-to-time, concerning official and officially recognised certificates.

23. A Party shall normally permit a wine or distilled spirits supplier to submit any required certification, test result or sample only with the initial shipment of a particular brand, producer and lot. If a Party requires a supplier to submit a sample of the product for the Party's procedure to assess conformity with its technical regulation or standard, it shall not require a sample quantity larger than the minimum quantity necessary to complete the relevant conformity assessment procedure. Nothing in this provision precludes a Party from undertaking verification of test results or certification, for example, where the Party has information that a particular product may be non-compliant.

24. Unless problems of human health or safety arise or threaten to arise for a Party, a Party shall not normally apply any final technical regulation, standard or conformity assessment procedure to wine or distilled spirits that have been placed on the market in the Party's territory before the date on which the technical regulation, standard or conformity assessment procedure enters into force, provided that the products are sold within a period of time after the date the technical regulation, standard or conformity assessment procedure enters into force, stipulated by the authority responsible for that technical regulation, standard or conformity assessment procedure.

25. Each Party shall endeavour to assess other Parties' laws, regulations and requirements in respect of oenological practices, with the aim of reaching agreements that provide for the Parties' acceptance of each other's mechanisms for regulating oenological practices, if appropriate.


ANNEX 8-B

INFORMATION AND COMMUNICATIONS TECHNOLOGY PRODUCTS

Section A: Information and Communication Technology (ICT) Products that Use Cryptography

1. This section shall apply to information and communication technology (ICT) products that use cryptography.10

2. For the purposes of this section:

cryptography means the principles, means or methods for the transformation of data in order to hide its information content, prevent its undetected modification or prevent its unauthorised use; and is limited to the transformation of information using one or more secret parameters, for example, crypto variables, or associated key management;

encryption means the conversion of data (plaintext) into a form that cannot be easily understood without subsequent re-conversion (ciphertext) through the use of a cryptographic algorithm;

cryptographic algorithm or cipher means a mathematical procedure or formula for combining a key with plaintext to create a ciphertext; and

key means a parameter used in conjunction with a cryptographic algorithm that determines its operation in such a way that an entity with knowledge of the key can reproduce or reverse the operation, while an entity without knowledge of the key cannot.

3. With respect to a product that uses cryptography and is designed for commercial applications, no Party shall impose or maintain a technical regulation or conformity assessment procedure that requires a manufacturer or supplier of the product, as a condition of the manufacture, sale, distribution, import or use of the product, to:

(a) transfer or provide access to a particular technology, production process or other information, for example, a private key or other secret parameter, algorithm specification or other design detail, that is proprietary to the manufacturer or supplier and relates to the cryptography in the product, to the Party or a person in the Party's territory;

(b) partner with a person in its territory; or

(c) use or integrate a particular cryptographic algorithm or cipher, other than where the manufacture, sale, distribution, import or use of the product is by or for the government of the Party.

4. Paragraph 3 shall not apply to: (a) requirements that a Party adopts or maintains relating to access to networks that are owned or controlled by the government of that Party, including those of central banks; or (b) measures taken by a Party pursuant to supervisory, investigatory or examination authority relating to financial institutions or markets.

5. For greater certainty, this Section shall not be construed to prevent a Party's law enforcement authorities from requiring service suppliers using encryption they control to provide, pursuant to that Party's legal procedures, unencrypted communications.

Section B: Electromagnetic Compatibility of Information Technology Equipment (ITE) Products

1. This section shall apply to the electromagnetic compatibility of information technology equipment (ITE) products.

2. For the purposes of this section:

ITE product means any device or system or component thereof that has a primary function of entry, storage, display, retrieval, transmission, processing, switching or control (or combinations thereof) of data or telecommunication messages by means other than radio transmission or reception and, for greater certainty, excludes any product or component thereof that has a primary function of radio transmission or reception;

electromagnetic compatibility means the ability of an equipment or system to function satisfactorily in its electromagnetic environment without introducing intolerable electromagnetic disturbances with respect to any other device or system in that environment; and

supplier's declaration of conformity means an attestation by a supplier that a product meets a specified standard or technical regulation based on an evaluation of the results of conformity assessment procedures.

3. If a Party requires positive assurance that an ITE product meets a standard or technical regulation for electromagnetic compatibility, it shall accept a supplier's declaration of conformity.

4. The Parties recognise that a Party may require testing, for example, by an independent accredited laboratory, in support of a supplier's declaration of conformity, registration of the supplier's declaration of conformity, or submission of evidence necessary to support the supplier's declaration of conformity.

5. Nothing in paragraph 3 shall prevent a Party from verifying a supplier's declaration of conformity.

6. Paragraph 3 shall not apply with respect to a product:

(a) that a Party regulates as a medical device, a medical device system or a component of a medical device or medical device system; or

(b) for which the Party demonstrates that there is a high risk that the product will cause harmful electromagnetic interference with a safety or radio transmission or reception device or system.

Section C: Regional Cooperation Activities on Telecommunications Equipment

1. This section shall apply to telecommunications equipment.

2. The Parties are encouraged to implement the APEC Mutual Recognition Arrangement for Conformity Assessment of Telecommunications Equipment of May 8, 1998 (MRA-TEL) and the APEC Mutual Recognition Arrangement for Equivalence of Technical Requirements of October 31, 2010 (MRA-ETR) with respect to each other or other arrangements to facilitate trade in telecommunications equipment.


ANNEX 8-C

PHARMACEUTICALS

1. This Annex shall apply to the preparation, adoption and application of technical regulations, standards, conformity assessment procedures, marketing authorisation and notification procedures of central government bodies that may affect trade in pharmaceutical products between the Parties. This Annex shall not apply to a technical specification prepared by a governmental entity for its production or consumption requirements or a sanitary or phytosanitary measure.

2. A Party's obligations under this Annex shall apply to any product that the Party defines as a pharmaceutical product pursuant to paragraph 3. For the purposes of this Annex, preparation of a technical regulation, standard, conformity assessment procedure or marketing authorisation includes, as appropriate, the evaluation of the risks involved, the need to adopt a measure to address those risks, the review of relevant scientific or technical information, and the consideration of the characteristics or design of alternative approaches.

3. Each Party shall define the scope of the products subject to its laws and regulations for pharmaceutical products in its territory and make that information publicly available.

4. Recognising that each Party is required to define the scope of products covered by this Annex pursuant to paragraph 3, for the purposes of this Annex, a pharmaceutical product may include a human drug or biologic that is intended for use in the diagnosis, cure, mitigation, treatment, or prevention of a disease or condition in humans, or intended to affect the structure or any function of the body of a human.

5. Each Party shall identify the agency or agencies that are authorised to regulate pharmaceutical products in its territory and make that information publicly available.

6. If more than one agency is authorised to regulate pharmaceutical products within the territory of a Party, that Party shall examine whether there is overlap or duplication in the scope of those authorities and take reasonable measures to eliminate unnecessary duplication of any regulatory requirements resulting for pharmaceutical products.

7. The Parties shall seek to collaborate through relevant international initiatives, such as those aimed at harmonisation, as well as regional initiatives that support those international initiatives, as appropriate, to improve the alignment of their respective regulations and regulatory activities for pharmaceutical products.

8. When developing or implementing regulations for marketing authorisation of pharmaceutical products, each Party shall consider relevant scientific or technical guidance documents developed through international collaborative efforts. Each Party is encouraged to consider regionally-developed scientific or technical guidance documents that are aligned with international efforts.

9. Each Party shall observe the obligations set out in Articles 2.1 and 5.1.1 of the TBT Agreement with respect to a marketing authorisation, notification procedure or elements of either that the Party prepares, adopts or applies for pharmaceutical products and that do not fall within the definition of a technical regulation or conformity assessment procedure.

10. Each Party recognises that the applicant is responsible for providing sufficient information to a Party for it to make a regulatory determination on a pharmaceutical product.

11. Each Party shall make its determination whether to grant marketing authorisation for a specific pharmaceutical product on the basis of:

(a) information, including, if appropriate, pre-clinical and clinical data, on safety and efficacy;

(b) information on the manufacturing quality of the product;

(c) labelling information related to the safety, efficacy and use of the product; and

(d) other matters that may directly affect the health or safety of the user of the product.

To this end, no Party shall require sale data or related financial data concerning the marketing of the product as part of the determination. Further, each Party shall endeavour to not require pricing data as part of the determination.

12. Each Party shall administer any marketing authorisation process that it maintains for pharmaceutical products in a timely, reasonable, objective, transparent and impartial manner, and identify and manage any conflicts of interest in order to mitigate any associated risks.

(a) Each Party shall provide an applicant that requests marketing authorisation for a pharmaceutical product with its determination within a reasonable period of time. The Parties recognise that the reasonable period of time required to make a marketing authorisation determination may be affected by factors such as the novelty of a product or regulatory implications that may arise.

(b) If a Party determines that a marketing authorisation application for a pharmaceutical product under review in its jurisdiction has deficiencies that have led or will lead to a decision not to authorise its marketing, that Party shall inform the applicant that requests marketing authorisation and provide reasons why the application is deficient.

(c) If a Party requires a marketing authorisation for a pharmaceutical product, the Party shall ensure that any marketing authorisation determination is subject to an appeal or review process that may be invoked at the request of the applicant. For greater certainty, the Party may maintain an appeal or review process that is either internal to the regulatory body responsible for the marketing authorisation determination, such as a dispute resolution or review process, or external to the regulatory body.

(d) If a Party requires periodic re-authorisation for a pharmaceutical product that has previously received marketing authorisation from the Party, the Party shall allow the pharmaceutical product to remain on its market under the conditions of the previous marketing authorisation pending a decision on the periodic reauthorisation, unless the Party identifies a significant health or safety concern.

13. When developing regulatory requirements for pharmaceutical products, a Party shall consider its available resources and technical capacity in order to minimise the implementation of requirements that could:

(a) inhibit the effectiveness of procedures for ensuring the safety, efficacy or manufacturing quality of pharmaceutical products; or

(b) lead to substantial delays in marketing authorisation regarding pharmaceutical products for sale on that Party's market.

14. No Party shall require that a pharmaceutical product receive marketing authorisation from a regulatory authority in the country of manufacture as a condition for the product to receive marketing authorisation from that Party.

15. For greater certainty, a Party may accept a prior marketing authorisation that is issued by another regulatory authority as evidence that a product may meet its own requirements. If there are regulatory resource limitations, a Party may require a marketing authorisation from one of a number of reference countries to be established and made public by that Party as a condition for the product's marketing authorisation from that Party.

16. For a marketing authorisation application for a pharmaceutical product, each Party shall review the safety, efficacy and manufacturing quality information submitted by the applicant requesting marketing authorisation in a format that is consistent with the principles found in the International Conference on Harmonisation of Technical Requirements for Registration of Pharmaceuticals for Human Use Common Technical Document (CTD), as may be amended, recognising that the CTD may not address all aspects relevant to a Party's determination to approve marketing authorisation for a particular product.

17. The Parties shall seek to improve their collaboration on pharmaceutical inspection, and to this end, each Party shall, with respect to the inspection of a pharmaceutical product within the territory of another Party:

(a) notify the other Party prior to conducting an inspection, unless there are reasonable grounds to believe that doing so could prejudice the effectiveness of the inspection;

(b) if practicable, permit representatives of the other Party's competent authority to observe that inspection; and

(c) notify the other Party of its findings as soon as possible following the inspection and, if the findings will be publicly released, no later than a reasonable time before release. The inspecting Party is not required to notify the other Party of its findings if it considers that those findings are confidential and should not be disclosed.

18. The Parties shall seek to apply relevant scientific guidance documents that are developed through international collaborative efforts with respect to inspection of pharmaceuticals.

ANNEX 8-D

COSMETICS

1. This Annex shall apply to the preparation, adoption and application of technical regulations, standards, conformity assessment procedures, marketing authorisation and notification procedures of central government bodies that may affect trade in cosmetic products between the Parties. This Annex shall not apply to a technical specification prepared by a governmental entity for its production or consumption requirements or a sanitary or phytosanitary measure.

2. A Party's obligations under this Annex shall apply to any product that the Party defines as a cosmetic product pursuant to paragraph 3. For the purposes of this Annex, preparation of a technical regulation, standard, conformity assessment procedure or marketing authorisation includes, as appropriate, the evaluation of the risks involved, the need to adopt a measure to address those risks, the review of relevant scientific or technical information, and the consideration of the characteristics or design of alternative approaches.

3. Each Party shall define the scope of the products subject to its laws and regulations for cosmetic products in its territory and make that information publicly available.

4. Recognising that each Party is required to define the scope of products covered by this Annex pursuant to paragraph 3, for the purposes of this Annex, a cosmetic product may include a product that is intended to be rubbed, poured, sprinkled, sprayed on or otherwise applied to the human body including the mucous membrane of the oral cavity and teeth, to cleanse, beautify, protect, promote attractiveness or alter the appearance.

5. Each Party shall identify the agency or agencies that are authorised to regulate cosmetic products in its territory and make that information publicly available.

6. If more than one agency is authorised to regulate cosmetic products within the territory of a Party, that Party shall examine whether there is overlap or duplication in the scope of those authorities and eliminate unnecessary duplication of any regulatory requirements resulting for cosmetic products.

7. The Parties shall seek to collaborate through relevant international initiatives, such as those aimed at harmonisation, as well as regional initiatives that support of those international initiatives, as appropriate, to improve the alignment of their respective regulations and regulatory activities for cosmetic products.

8. When developing or implementing regulations for cosmetic products, each Party shall consider relevant scientific or technical guidance documents developed through international collaborative efforts. Each Party is encouraged to consider regionally-developed scientific or technical guidance documents that are aligned with international efforts.

9. Each Party shall observe the obligations set out in Articles 2.1 and 5.1.1 of the TBT Agreement with respect to a marketing authorisation, notification procedure or elements of either that the Party prepares, adopts or applies for cosmetic products and that do not fall within the definition of a technical regulation or conformity assessment procedure.

10. Each Party shall ensure that it applies a risk-based approach to the regulation of cosmetic products.

11. In applying a risk-based approach in regulating cosmetic products, each Party shall take into account that cosmetic products are generally expected to pose less potential risk to human health or safety than medical devices or pharmaceutical products.

12. No Party shall conduct separate marketing authorisation processes or sub processes for cosmetic products that differ only with respect to shade extensions or fragrance variants, unless a Party identifies a significant human health or safety concern.

13. Each Party shall administer any marketing authorisation process that it maintains for cosmetics products in a timely, reasonable, objective, transparent and impartial manner, and identify and manage any conflicts of interest in order to mitigate any associated risks.

(a) If a Party requires marketing authorisation for a cosmetic product, that Party shall provide an applicant with its determination within a reasonable period of time.

(b) If a Party requires marketing authorisation for a cosmetic product and it determines that a marketing authorisation application for a cosmetic product under review in its jurisdiction has deficiencies that have led or will lead to a decision not to authorise its marketing, that Party shall inform the applicant that requests marketing authorisation and provide reasons why the application is deficient.

(c) If a Party requires a marketing authorisation for a cosmetic product, the Party shall ensure that any marketing authorisation determination is subject to an appeal or review process that may be invoked at the request of the applicant. For greater certainty, the Party may maintain an appeal or review process that is either internal to the regulatory body responsible for the marketing authorisation determination, such as a dispute resolution or review process, or external to the regulatory body.

(d) If a Party has granted marketing authorisation for a cosmetic product in its territory, the Party shall not subject the product to periodic re-assessment procedures as a condition of retaining its marketing authorisation.

14. If a Party maintains a marketing authorisation process for cosmetic products, that Party shall consider replacing this process with other mechanisms such as voluntary or mandatory notification and post-market surveillance.

15. When developing regulatory requirements for cosmetic products, a Party shall consider its available resources and technical capacity in order to minimise the implementation of requirements that could:

(a) inhibit the effectiveness of procedures for ensuring the safety or manufacturing quality of cosmetic products; or

(b) lead to substantial delays in marketing authorisation regarding cosmetic products for sale on that Party's market.

16. No Party shall require the submission of marketing information, including with respect to prices or cost, as a condition for the product receiving marketing authorisation.

17. No Party shall require a cosmetic product to be labelled with a marketing authorisation or notification number.

18. No Party shall require that a cosmetic product receive marketing authorisation from a regulatory authority in the country of manufacture, as a condition for the product receiving marketing authorisation from the Party. For greater certainty, this provision does not prohibit a Party from accepting a prior marketing authorisation issued by another regulatory authority as evidence that a product may meet its own requirements.

19. No Party shall require that a cosmetic product be accompanied by a certificate of free sale as a condition of marketing, distribution or sale in the Party's territory.

20. If a Party requires a manufacturer or supplier of a cosmetic product to indicate information on the product's label, the Party shall permit the manufacturer or supplier to indicate the required information by relabelling the product or by using supplementary labelling of the product in accordance with the Party's domestic requirements after importation but prior to offering the product for sale or supply in the Party's territory.

21. No Party shall require that a cosmetic product be tested on animals to determine the safety of that cosmetic product, unless there is no validated alternative method available to assess safety. A Party may, however, consider the results of animal testing to determine the safety of a cosmetic product.

22. If a Party prepares or adopts good manufacturing practice guidelines for cosmetic products, it shall use relevant international standards for cosmetic products, or the relevant parts of them, as a basis for its guidelines unless those international standards or relevant parts would be an ineffective or inappropriate means for the fulfilment of the legitimate objectives pursued.

23. Each Party shall endeavour to share, subject to its laws and regulations, information from post-market surveillance of cosmetic products.

24. Each Party shall endeavour to share information on its findings or the findings of its relevant institutions regarding cosmetic ingredients.

25. Each Party shall endeavour to avoid re-testing or re-evaluating cosmetic products that differ only with respect to shade extensions or fragrance variants, unless conducted for human health or safety purposes.

ANNEX 8-E

MEDICAL DEVICES

1. This Annex shall apply to the preparation, adoption and application of technical regulations, standards, conformity assessment procedures, marketing authorisation and notification procedures of central government bodies that may affect trade in medical devices between the Parties. This Annex shall not apply to a technical specification prepared by a governmental entity for its production or consumption requirements or a sanitary or phytosanitary measure.

2. A Party's obligations under this Annex shall apply to any product that the Party defines as a medical device pursuant to paragraph 3. For the purposes of this Annex, preparation of a technical regulation, standard, conformity assessment procedure or marketing authorisation includes, as appropriate the evaluation of the risks involved, the need to adopt a measure to address those risks, the review of relevant scientific or technical information, and the consideration of the characteristics or design of alternative approaches.

3. Each Party shall define the scope of the products subject to its laws and regulations for medical devices in its territory and make that information publicly available.

4. Recognising that each Party is required to define the scope of products covered by this Annex pursuant to paragraph 3, each Party should define the scope of products subject to its laws and regulations for medical devices in a manner that is consistent with the meaning assigned to the term "medical device" in the Definition of the Terms ‘Medical Device' and ‘In Vitro Diagnostic (IVD) Medical Device' endorsed by the Global Harmonization Task Force on May 16, 2012, as may be amended.

5. Each Party shall identify the agency or agencies that are authorised to regulate medical devices in its territory and make that information publicly available.

6. If more than one agency is authorised to regulate medical devices within the territory of a Party, that Party shall examine whether there is overlap or duplication in the scope of those authorities and to take reasonable measures to eliminate unnecessary duplication of any regulatory requirements resulting for medical devices.

7. The Parties shall seek to collaborate through relevant international initiatives, such as those aimed at harmonisation, as well as regional initiatives that support of those international initiatives, as appropriate, to improve the alignment of their respective regulations and regulatory activities for medical devices.

8. When developing or implementing regulations for marketing authorisation of medical devices, each Party shall consider relevant scientific or technical guidance documents developed through international collaborative efforts. Each Party is encouraged to consider regionally-developed scientific or technical guidance documents that are aligned with international efforts.

9. Each Party shall observe the obligations set out in Articles 2.1 and 5.1.1 of the TBT Agreement with respect to a marketing authorisation, notification procedure or elements of either that the Party prepares, adopts or applies for medical devices and that do not fall within the definition of a technical regulation or conformity assessment procedure.

10. Recognising that different medical devices pose different levels of risk, each Party shall classify medical devices based on risk, taking into account scientifically relevant factors. Each Party shall ensure that, when it regulates a medical device, it regulates the device consistent with the classification the Party has assigned to that device.

11. Each Party recognises that the applicant is responsible for providing sufficient information to a Party for it to make a regulatory determination on a medical device.

12. Each Party shall make a determination whether to grant marketing authorisation for a specific medical device on the basis of:

(a) information, including, if appropriate, clinical data, on safety and efficacy;

(b) information on performance, design and manufacturing quality of the device;

(c) labelling information related to safety, efficacy and use of the device; and

(d) other matters that may directly affect the health or safety of the user of the device.

To this end, no Party shall require sale data, pricing or related financial data concerning the marketing of the medical device.

13. Each Party shall administer any marketing authorisation process that it maintains for medical devices in a timely, reasonable, objective, transparent and impartial manner, and identify and manage any conflicts of interest in order to mitigate any associated risks.

(a) Each Party shall provide an applicant that requests marketing authorisation for a medical device with its determination within a reasonable period of time. The Parties recognise that the reasonable period of time required to make a marketing authorisation determination may be affected by factors such as the novelty of a device or regulatory implications that may arise.

(b) If a Party determines that a marketing authorisation application for a medical device under review in its jurisdiction has deficiencies that have led or will lead to a decision not to authorise its marketing, that Party shall inform the applicant that requests marketing authorisation and provide reasons why the application is deficient.

(c) If a Party requires marketing authorisation for a medical device, the Party shall ensure that any marketing authorisation determination is subject to an appeal or review process that may be invoked at the request of the applicant. For greater certainty, the Party may maintain an appeal or review process that is either internal to the regulatory body responsible for the marketing authorisation determination, such as a dispute resolution or review process, or external to the regulatory body.

(d) If a Party requires periodic re-authorisation for a medical device that has previously received marketing authorisation from the Party, the Party shall allow the medical device to remain on its market under the conditions of the previous marketing authorisation pending a decision on the periodic re-authorisation, unless a Party identifies a significant health or safety concern.

14. When developing regulatory requirements for medical devices, a Party shall consider its available resources and technical capacity in order to minimise the implementation of requirements that could:

(a) inhibit the effectiveness of procedures for ensuring the safety, efficacy or manufacturing quality of medical devices; or

(b) lead to substantial delays in marketing authorisation regarding medical devices for sale on that Party's market.

15. No Party shall require that a medical device receive a marketing authorisation from a regulatory authority in the country of manufacture as a condition for the medical device to receive marketing authorisation from that Party.

16. For greater certainty, a Party may accept a prior marketing authorisation that is issued by another regulatory authority as evidence that a medical device may meet its own requirements. If there are regulatory resource limitations, a Party may require a marketing authorisation from one of a number of reference countries established and made public by that Party as a condition for the medical device's marketing authorisation from that Party.

17. If a Party requires a manufacturer or supplier of a medical device to indicate information on the product's label, the Party shall permit the manufacturer or supplier to indicate the required information by relabelling the product or by using supplementary labelling of the device in accordance with the Party's domestic requirements after importation but prior to offering the device for sale or supply in the Party's territory.

ANNEX 8-F

PROPRIETARY FORMULAS FOR PREPACKAGED FOODS AND FOOD ADDITIVES

1. This Annex shall apply to the preparation, adoption and application of technical regulations and standards of central government bodies that are related to prepackaged foods and food additives. This Annex shall not apply to technical specifications prepared by a governmental entity for its production or consumption requirements or sanitary and phytosanitary measures.

2. For the purposes of this Annex, the terms "food," "food additive" and "prepackaged" have the same meanings as set out in the Codex General Standard for the Labelling of Pre-Packaged Food (CODEX STAN 1-1985) and the Codex General Standard for the Labelling of Food Additives When Sold as Such

(CODEX STAN 107-1981), as may be amended.

3. When gathering information relating to proprietary formulas in the preparation, adoption and application of technical regulations and standards, each Party shall:

(a) ensure that its information requirements are limited to what is necessary to achieve its legitimate objective; and

(b) ensure that the confidentiality of information about products originating in the territory of another Party arising from, or supplied in connection with, the preparation, adoption, and application of technical regulations and standards, is respected in the same way as for domestic products and in a manner that protects legitimate commercial interests.

If a Party gathers confidential information relating to proprietary formulas, it may use that information in the course of administrative and judicial proceedings in accordance with its law, provided that the Party has procedures to maintain the confidentiality of the information in the course of those proceedings.

4. Nothing in paragraph 3 shall prevent a Party from requiring ingredients to be listed on labels consistent with CODEX STAN 1-1985 and CODEX STAN 107-1981, as may be amended, except when those standards would be an ineffective or inappropriate means for the fulfilment of a legitimate objective.

ANNEX 8-G

ORGANIC PRODUCTS

1. This Annex shall apply to a Party if that Party is developing or maintains technical regulations, standards or conformity assessment procedures that relate to the production, processing or labelling of products as organic for sale or distribution within its territory.

2. Each Party is encouraged to take steps to:

(a) exchange information on matters that relate to organic production, certification of organic products, and related control systems; and

(b) cooperate with other Parties to develop, improve and strengthen international guidelines, standards and recommendations that relate to trade in organic products.

3. If a Party maintains a requirement that relates to the production, processing or labelling of products as organic, it shall enforce that requirement.

4. A Party is encouraged to consider, as expeditiously as possible, a request from another Party for recognition or equivalence of a technical regulations, standards or conformity assessment procedures that relates to the production, processing, or labelling of products of another Party as organic. Each Party is encouraged to accept as equivalent or recognise the technical regulations, standards or conformity assessment procedures that relate to the production, processing or labelling of products of that other Party as organic, if the Party is satisfied that the technical regulations, standards or conformity assessment procedures of that other Party adequately fulfils the objectives of the Party's technical regulations, standards or conformity assessment procedures. If a Party does not accept as equivalent or recognise the technical regulations, standards or conformity assessment procedures that relate to the production, processing, or labelling of products of that other Party as organic, it shall, on request of that other Party, explain its reasons.

5. Each Party is encouraged to participate in technical exchanges to support improvement and greater alignment of technical regulations, standards or conformity assessment procedures that relate to the production, processing or labelling of products as organic.


CHAPTER 9

INVESTMENT

Section A

Article 9.1: Definitions

For the purposes of this Chapter:

Centre means the International Centre for Settlement of Investment Disputes (ICSID) established by the ICSID Convention;

claimant means an investor of a Party that is a party to an investment dispute with another Party. If that investor is a natural person, who is a permanent resident of a Party and a national of another Party, that natural person may not submit a claim to arbitration against that latter Party;

covered investment means, with respect to a Party, an investment in its territory of an investor of another Party in existence as of the date of entry into force of this Agreement for those Parties or established, acquired, or expanded thereafter;

disputing parties means the claimant and the respondent;

disputing party means either the claimant or the respondent;

enterprise means an enterprise as defined in Article 1.3 (General Definitions), and a branch of an enterprise;

enterprise of a Party means an enterprise constituted or organised under the law of a Party, or a branch located in the territory of a Party and carrying out business activities there;

freely usable currency means "freely usable currency" as determined by the International Monetary Fund under its Articles of Agreement;

ICC Arbitration Rules means the arbitration rules of the International Chamber of Commerce;

ICSID Additional Facility Rules means the Rules Governing the Additional Facility for the Administration of Proceedings by the Secretariat of the International Centre for Settlement of Investment Disputes;

ICSID Convention means the Convention on the Settlement of Investment Disputes between States and Nationals of other States, done at Washington, March 18, 1965;

Inter-American Convention means the Inter-American Convention on International Commercial Arbitration, done at Panama, January 30, 1975;

investment means every asset that an investor owns or controls, directly or indirectly, that has the characteristics of an investment, including such characteristics as the commitment of capital or other resources, the expectation of gain or profit, or the assumption of risk. Forms that an investment may take include:

(a) an enterprise;

(b) shares, stock and other forms of equity participation in an enterprise;

(c) bonds, debentures, other debt instruments and loans;

(d) futures, options and other derivatives;

(e) turnkey, construction, management, production, concession, revenue-sharing and other similar contracts;

(f) intellectual property rights;

(g) licences, authorisations, permits and similar rights conferred pursuant to the Party's law; and

(h) other tangible or intangible, movable or immovable property, and related property rights, such as leases, mortgages, liens and pledges, but investment does not mean an order or judgment entered in a judicial or administrative action.

investment agreement means a written agreement5 that is concluded and takes effect after the date of entry into force of this Agreement6 between an authority at the central level of government of a Party and a covered investment or an investor of another Party and that creates an exchange of rights and obligations, binding on both parties under the law applicable under Article 9.25.2 (Governing Law), on which the covered investment or the investor relies in establishing or acquiring a covered investment other than the written agreement itself, and that grants rights to the covered investment or investor:

(a) with respect to natural resources that a national authority controls, such as oil, natural gas, rare earth minerals, timber, gold, iron ore and other similar resources, including for their exploration, extraction, refining, transportation, distribution or sale;

(b) to supply services on behalf of the Party for consumption by the general public for: power generation or distribution, water treatment or distribution, telecommunications, or other similar services supplied on behalf of the Party for consumption by the general public; or

(c) to undertake infrastructure projects, such as the construction of roads, bridges, canals, dams or pipelines or other similar projects; provided, however, that the infrastructure is not for the exclusive or predominant use and benefit of the government;

investment authorisation10 means an authorisation that the foreign investment authority of a Party grants to a covered investment or an investor of another Party;

investor of a non-Party means, with respect to a Party, an investor that attempts to make, is making, or has made an investment in the territory of that Party, that is not an investor of a Party;

investor of a Party means a Party, or a national or an enterprise of a Party, that attempts to make, is making, or has made an investment in the territory of another Party;

LCIA Arbitration Rules means the arbitration rules of the London Court of International Arbitration;

negotiated restructuring means the restructuring or rescheduling of a debt instrument that has been effected through (a) a modification or amendment of that debt instrument, as provided for under its terms, or (b) a comprehensive debt exchange or other similar process in which the holders of no less than 75 per cent of the aggregate principal amount of the outstanding debt under that debt instrument have consented to the debt exchange or other process;

New York Convention means the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, done at New York, June 10, 1958;

non-disputing Party means a Party that is not a party to an investment dispute;

protected information means confidential business information or information that is privileged or otherwise protected from disclosure under a Party's law, including classified government information;

respondent means the Party that is a party to an investment dispute; Secretary-General means the Secretary-General of ICSID; and

UNCITRAL Arbitration Rules means the arbitration rules of the United Nations Commission on International Trade Law.

Article 9.2: Scope

1. This Chapter shall apply to measures adopted or maintained by a Party relating to:

(a) investors of another Party;

(b) covered investments; and

(c) with respect to Article 9.10 (Performance Requirements) and Article 9.16 (Investment and Environmental, Health and other Regulatory Objectives), all investments in the territory of that Party.

2. A Party's obligations under this Chapter shall apply to measures adopted or maintained by:

(a) the central, regional or local governments or authorities of that Party; and

(b) any person, including a state enterprise or any other body, when it exercises any governmental authority delegated to it by central, regional or local governments or authorities of that Party.13

3. For greater certainty, this Chapter shall not bind a Party in relation to an act or fact that took place or a situation that ceased to exist before the date of entry into force of this Agreement for that Party.

Article 9.3: Relation to Other Chapters

1. In the event of any inconsistency between this Chapter and another Chapter of this Agreement, the other Chapter shall prevail to the extent of the inconsistency.

2. A requirement of a Party that a service supplier of another Party post a bond or other form of financial security as a condition for the cross-border supply of a service does not of itself make this Chapter applicable to measures adopted or maintained by the Party relating to such cross-border supply of the service. This Chapter shall apply to measures adopted or maintained by the Party relating to the posted bond or financial security, to the extent that the bond or financial security is a covered investment.

3. This Chapter shall not apply to measures adopted or maintained by a Party to the extent that they are covered by Chapter 11 (Financial Services).

Article 9.4: National Treatment14

1. Each Party shall accord to investors of another Party treatment no less favourable than that it accords, in like circumstances, to its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.

2. Each Party shall accord to covered investments treatment no less favourable than that it accords, in like circumstances, to investments in its territory of its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments.

3. For greater certainty, the treatment to be accorded by a Party under paragraphs 1 and 2 means, with respect to a regional level of government, treatment no less favourable than the most favourable treatment accorded, in like circumstances, by that regional level of government to investors, and to investments of investors, of the Party of which it forms a part.

Article 9.5: Most-Favoured-Nation Treatment

1. Each Party shall accord to investors of another Party treatment no less favourable than that it accords, in like circumstances, to investors of any other Party or of any non-Party with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.

2. Each Party shall accord to covered investments treatment no less favourable than that it accords, in like circumstances, to investments in its territory of investors of any other Party or of any non-Party with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments.

3. For greater certainty, the treatment referred to in this Article does not encompass international dispute resolution procedures or mechanisms, such as those included in Section B (Investor-State Dispute Settlement).

Article 9.6: Minimum Standard of Treatment

1. Each Party shall accord to covered investments treatment in accordance with applicable customary international law principles, including fair and equitable treatment and full protection and security.

2. For greater certainty, paragraph 1 prescribes the customary international law minimum standard of treatment of aliens as the standard of treatment to be afforded to covered investments. The concepts of "fair and equitable treatment" and "full protection and security" do not require treatment in addition to or beyond that which is required by that standard, and do not create additional substantive rights. The obligations in paragraph 1 to provide:

(a) "fair and equitable treatment" includes the obligation not to deny justice in criminal, civil or administrative adjudicatory proceedings in accordance with the principle of due process embodied in the principal legal systems of the world; and

(b) "full protection and security" requires each Party to provide the level of police protection required under customary international law.

3. A determination that there has been a breach of another provision of this Agreement, or of a separate international agreement, does not establish that there has been a breach of this Article.

4. For greater certainty, the mere fact that a Party takes or fails to take an action that may be inconsistent with an investor's expectations does not constitute a breach of this Article, even if there is loss or damage to the covered investment as a result.

5. For greater certainty, the mere fact that a subsidy or grant has not been issued, renewed or maintained, or has been modified or reduced, by a Party, does not constitute a breach of this Article, even if there is loss or damage to the covered investment as a result.

Article 9.7: Treatment in Case of Armed Conflict or Civil Strife

1. Notwithstanding Article 9.12.6(b) (Non-Conforming Measures), each Party shall accord to investors of another Party and to covered investments non discriminatory treatment with respect to measures it adopts or maintains relating to losses suffered by investments in its territory owing to armed conflict or civil strife.

2. Notwithstanding paragraph 1, if an investor of a Party, in a situation referred to in paragraph 1, suffers a loss in the territory of another Party resulting from:

(a) requisitioning of its covered investment or part thereof by the latter's forces or authorities; or

(b) destruction of its covered investment or part thereof by the latter's forces or authorities, which was not required by the necessity of the situation,

the latter Party shall provide the investor restitution, compensation or both, as appropriate, for that loss.

3. Paragraph 1 shall not apply to existing measures relating to subsidies or grants that would be inconsistent with Article 9.4 (National Treatment) but for Article 9.12.6(b) (Non-Conforming Measures).

Article 9.8: Expropriation and Compensation

1. No Party shall expropriate or nationalise a covered investment either directly or indirectly through measures equivalent to expropriation or nationalisation (expropriation), except:

(a) for a public purpose;

(b) in a non-discriminatory manner;

(c) on payment of prompt, adequate and effective compensation in accordance with paragraphs 2, 3 and 4; and

(d) in accordance with due process of law.

2. Compensation shall:

(a) be paid without delay;

(b) be equivalent to the fair market value of the expropriated investment immediately before the expropriation took place (the date of expropriation);

(c) not reflect any change in value occurring because the intended expropriation had become known earlier; and

(d) be fully realisable and freely transferable.

3. If the fair market value is denominated in a freely usable currency, the compensation paid shall be no less than the fair market value on the date of expropriation, plus interest at a commercially reasonable rate for that currency, accrued from the date of expropriation until the date of payment.

4. If the fair market value is denominated in a currency that is not freely usable, the compensation paid, converted into the currency of payment at the market rate of exchange prevailing on the date of payment, shall be no less than:

(a) the fair market value on the date of expropriation, converted into a freely usable currency at the market rate of exchange prevailing on that date; plus

(b) interest, at a commercially reasonable rate for that freely usable currency, accrued from the date of expropriation until the date of payment.

5. This Article shall not apply to the issuance of compulsory licences granted in relation to intellectual property rights in accordance with the TRIPS Agreement, or to the revocation, limitation or creation of intellectual property rights, to the extent that the issuance, revocation, limitation or creation is consistent with Chapter 18 (Intellectual Property) and the TRIPS Agreement.

6. For greater certainty, a Party's decision not to issue, renew or maintain a subsidy or grant, or decision to modify or reduce a subsidy or grant,

(a) in the absence of any specific commitment under law or contract to issue, renew or maintain that subsidy or grant; or

(b) in accordance with any terms or conditions attached to the issuance, renewal, modification, reduction and maintenance of that subsidy or grant, standing alone, does not constitute an expropriation.

Article 9.9: Transfers

1. Each Party shall permit all transfers relating to a covered investment to be made freely and without delay into and out of its territory. Such transfers include:

(a) contributions to capital;

(b) profits, dividends, interest, capital gains, royalty payments, management fees, technical assistance fees and other fees;

(c) proceeds from the sale of all or any part of the covered investment or from the partial or complete liquidation of the covered investment;

(d) payments made under a contract, including a loan agreement;

(e) payments made pursuant to Article 9.7 (Treatment in Case of Armed Conflict or Civil Strife) and Article 9.8 (Expropriation and Compensation); and

(f) payments arising out of a dispute.

2. Each Party shall permit transfers relating to a covered investment to be made in a freely usable currency at the market rate of exchange prevailing at the time of transfer.

3. Each Party shall permit returns in kind relating to a covered investment to be made as authorised or specified in a written agreement between the Party and a covered investment or an investor of another Party.

4. Notwithstanding paragraphs 1, 2 and 3, a Party may prevent or delay a transfer through the equitable, non-discriminatory and good faith application of its laws relating to:

(a) bankruptcy, insolvency or the protection of the rights of creditors;

(b) issuing, trading or dealing in securities, futures, options or derivatives;

(c) criminal or penal offences;

(d) financial reporting or record keeping of transfers when necessary to assist law enforcement or financial regulatory authorities; or

(e) ensuring compliance with orders or judgments in judicial or administrative proceedings.

5. Notwithstanding paragraph 3, a Party may restrict transfers of returns in kind in circumstances where it could otherwise restrict such transfers under this Agreement, including as set out in paragraph 4.

Article 9.10: Performance Requirements

1. No Party shall, in connection with the establishment, acquisition, expansion, management, conduct, operation, or sale or other disposition of an investment of an investor of a Party or of a non-Party in its territory, impose or enforce any requirement, or enforce any commitment or undertaking:

(a) to export a given level or percentage of goods or services;

(b) to achieve a given level or percentage of domestic content;

(c) to purchase, use or accord a preference to goods produced in its territory, or to purchase goods from persons in its territory;

(d) to relate in any way the volume or value of imports to the volume or value of exports or to the amount of foreign exchange inflows associated with the investment;

(e) to restrict sales of goods or services in its territory that the investment produces or supplies by relating those sales in any way to the volume or value of its exports or foreign exchange earnings;

(f) to transfer a particular technology, a production process or other proprietary knowledge to a person in its territory;

(g) to supply exclusively from the territory of the Party the goods that the investment produces or the services that it supplies to a specific regional market or to the world market;

(h) (i) to purchase, use or accord a preference to, in its territory, technology of the Party or of a person of the Party;24 or

(ii) that prevents the purchase or use of, or the according of a preference to, in its territory, a particular technology; or

(i) to adopt:

(i) a given rate or amount of royalty under a licence contract; or

(ii) a given duration of the term of a licence contract, in regard to any licence contract in existence at the time the requirement is imposed or enforced, or any commitment or undertaking is enforced, or any future licence contract25 freely entered into between the investor and a person in its territory, provided that the requirement is imposed or the commitment or undertaking is enforced in a manner that constitutes direct interference with that licence contract by an exercise of non judicial governmental authority of a Party. For greater certainty, paragraph 1(i) does not apply when the licence contract is concluded between the investor and a Party.

2. No Party shall condition the receipt or continued receipt of an advantage, in connection with the establishment, acquisition, expansion, management, conduct, operation, or sale or other disposition of an investment of an investor of a Party or of a non-Party in its territory, on compliance with any requirement:

(a) to achieve a given level or percentage of domestic content;

(b) to purchase, use or accord a preference to goods produced in its territory, or to purchase goods from persons in its territory;

(c) to relate in any way the volume or value of imports to the volume or value of exports or to the amount of foreign exchange inflows associated with the investment; or

(d) to restrict sales of goods or services in its territory that the investment produces or supplies by relating those sales in any way to the volume or value of its exports or foreign exchange earnings.

3. (a) Nothing in paragraph 2 shall be construed to prevent a Party from conditioning the receipt or continued receipt of an advantage, in connection with an investment of an investor of a Party or of a non-Party in its territory, on compliance with a requirement to locate production, supply a service, train or employ workers, construct or expand particular facilities, or carry out research and development, in its territory.

(b) Paragraphs 1(f), 1(h) and 1(i) shall not apply:

(i) if a Party authorises use of an intellectual property right in accordance with Article 31 of the TRIPS Agreement, or to measures requiring the disclosure of proprietary information that fall within the scope of, and are consistent with, Article 39 of the TRIPS Agreement; or

(ii) if the requirement is imposed or the commitment or undertaking is enforced by a court, administrative tribunal or competition authority to remedy a practice determined after judicial or administrative process to be anticompetitive under the Party's competition laws.

(c) Paragraph 1(i) shall not apply if the requirement is imposed or the commitment or undertaking is enforced by a tribunal as equitable remuneration under the Party's copyright laws.

(d) Provided that such measures are not applied in an arbitrary or unjustifiable manner, or do not constitute a disguised restriction on international trade or investment, paragraphs 1(b), 1(c), 1(f), 2(a) and 2(b) shall not be construed to prevent a Party from adopting or maintaining measures, including environmental measures:

(i) necessary to secure compliance with laws and regulations that are not inconsistent with this Agreement;

(ii) necessary to protect human, animal or plant life or health; or

(iii) related to the conservation of living or non-living exhaustible natural resources.

(e) Paragraphs 1(a), 1(b), 1(c), 2(a) and 2(b) shall not apply to qualification requirements for goods or services with respect to export promotion and foreign aid programs.

(f) Paragraphs 1(b), 1(c), 1(f), 1(g), 1(h), 1(i), 2(a) and 2(b) shall not apply to government procurement.

(g) Paragraphs 2(a) and 2(b) shall not apply to requirements imposed by an importing Party relating to the content of goods necessary to qualify for preferential tariffs or preferential quotas.

(h) Paragraphs (1)(h) and (1)(i) shall not be construed to prevent a Party from adopting or maintaining measures to protect legitimate public welfare objectives, provided that such measures are not applied in an arbitrary or unjustifiable manner, or in a manner that constitutes a disguised restriction on international trade or investment.

4. For greater certainty, nothing in paragraph 1 shall be construed to prevent a Party, in connection with the establishment, acquisition, expansion, management, conduct, operation, or sale or other disposition of an investment of an investor of a Party or of a non-Party in its territory, from imposing or enforcing a requirement, or enforcing a commitment or undertaking, to employ or train workers in its territory provided that the employment or training does not require the transfer of a particular technology, production process or other proprietary knowledge to a person in its territory.

5. For greater certainty, paragraphs 1 and 2 shall not apply to any commitment, undertaking or requirement other than those set out in those paragraphs.

6. This Article does not preclude enforcement of any commitment, undertaking or requirement between private parties, if a Party did not impose or require the commitment, undertaking or requirement.

Article 9.11: Senior Management and Boards of Directors

1. No Party shall require that an enterprise of that Party that is a covered investment appoint to a senior management position a natural person of any particular nationality.

2. A Party may require that a majority of the board of directors, or any committee thereof, of an enterprise of that Party that is a covered investment, be of a particular nationality or resident in the territory of the Party, provided that the requirement does not materially impair the ability of the investor to exercise control over its investment.

Article 9.12: Non-Conforming Measures

1. Article 9.4 (National Treatment), Article 9.5 (Most-Favoured-Nation Treatment), Article 9.10 (Performance Requirements) and Article 9.11 (Senior Management and Boards of Directors) shall not apply to:

(a) any existing non-conforming measure that is maintained by a Party at:

(i) the central level of government, as set out by that Party in its Schedule to Annex I;

(ii) a regional level of government, as set out by that Party in its Schedule to Annex I; or

(iii) a local level of government;

(b) the continuation or prompt renewal of any non-conforming measure referred to in subparagraph (a); or

(c) an amendment to any non-conforming measure referred to in subparagraph (a), to the extent that the amendment does not decrease the conformity of the measure, as it existed immediately before the amendment, with Article 9.4 (National Treatment), Article 9.5 (Most-Favoured-Nation Treatment), Article 9.10 (Performance Requirements) or Article 9.11 (Senior Management and Boards of Directors).

2. Article 9.4 (National Treatment), Article 9.5 (Most-Favoured-Nation Treatment), Article 9.10 (Performance Requirements) and Article 9.11 (Senior Management and Boards of Directors) shall not apply to any measure that a Party adopts or maintains with respect to sectors, subsectors or activities, as set out by that Party in its Schedule to Annex II.

3. If a Party considers that a non-conforming measure applied by a regional level of government of another Party, as referred to in paragraph 1(a)(ii), creates a material impediment to investment in relation to the former Party, it may request consultations with regard to that measure. These Parties shall enter into consultations with a view to exchanging information on the operation of the measure and to considering whether further steps are necessary and appropriate.

4. No Party shall, under any measure adopted after the date of entry into force of this Agreement for that Party and covered by its Schedule to Annex II, require an investor of another Party, by reason of its nationality, to sell or otherwise dispose of an investment existing at the time the measure becomes effective.

5. (a) Article 9.4 (National Treatment) shall not apply to any measure that falls within an exception to, or derogation from, the obligations which are imposed by:

(i) Article 18.8 (National Treatment); or

(ii) Article 3 of the TRIPS Agreement, if the exception or derogation relates to matters not addressed by Chapter 18 (Intellectual Property).

(b) Article 9.5 (Most-Favoured-Nation Treatment) shall not apply to any measure that falls within Article 5 of the TRIPS Agreement, or an exception to, or derogation from, the obligations which are imposed by:

(i) Article 18.8 (National Treatment); or

(ii) Article 4 of the TRIPS Agreement.

6. Article 9.4 (National Treatment), Article 9.5 (Most-Favoured-Nation Treatment) and Article 9.11 (Senior Management and Boards of Directors) shall not apply to:

(a) government procurement; or

(b) subsidies or grants provided by a Party, including government supported loans, guarantees and insurance.

7. For greater certainty, any amendments or modifications to a Party's Schedules to Annex I or Annex II, pursuant to this Article, shall be made in accordance with Article 30.2 (Amendments).

Article 9.13: Subrogation

If a Party, or any agency, institution, statutory body or corporation designated by the Party, makes a payment to an investor of the Party under a guarantee, a contract of insurance or other form of indemnity that it has entered into with respect to a covered investment, the other Party in whose territory the covered investment was made shall recognise the subrogation or transfer of any rights the investor would have possessed under this Chapter with respect to the covered investment but for the subrogation, and the investor shall be precluded from pursuing these rights to the extent of the subrogation.

Article 9.14: Special Formalities and Information Requirements

1. Nothing in Article 9.4 (National Treatment) shall be construed to prevent a Party from adopting or maintaining a measure that prescribes special formalities in connection with a covered investment, such as a residency requirement for registration or a requirement that a covered investment be legally constituted under the laws or regulations of the Party, provided that these formalities do not materially impair the protections afforded by the Party to investors of another Party and covered investments pursuant to this Chapter.

2. Notwithstanding Article 9.4 (National Treatment) and Article 9.5 (Most Favoured-Nation Treatment), a Party may require an investor of another Party or its covered investment to provide information concerning that investment solely for informational or statistical purposes. The Party shall protect such information that is confidential from any disclosure that would prejudice the competitive position of the investor or the covered investment. Nothing in this paragraph shall be construed to prevent a Party from otherwise obtaining or disclosing information in connection with the equitable and good faith application of its law.

Article 9.15: Denial of Benefits

1. A Party may deny the benefits of this Chapter to an investor of another Party that is an enterprise of that other Party and to investments of that investor if the enterprise:

(a) is owned or controlled by a person of a non-Party or of the denying Party; and

(b) has no substantial business activities in the territory of any Party other than the denying Party.

2. A Party may deny the benefits of this Chapter to an investor of another Party that is an enterprise of that other Party and to investments of that investor if persons of a non-Party own or control the enterprise and the denying Party adopts or maintains measures with respect to the non-Party or a person of the non-Party that prohibit transactions with the enterprise or that would be violated or circumvented if the benefits of this Chapter were accorded to the enterprise or to its investments.

Article 9.16: Investment and Environmental, Health and other Regulatory Objectives

Nothing in this Chapter shall be construed to prevent a Party from adopting, maintaining or enforcing any measure otherwise consistent with this Chapter that it considers appropriate to ensure that investment activity in its territory is undertaken in a manner sensitive to environmental, health or other regulatory objectives.

Article 9.17: Corporate Social Responsibility

The Parties reaffirm the importance of each Party encouraging enterprises operating within its territory or subject to its jurisdiction to voluntarily incorporate into their internal policies those internationally recognised standards, guidelines and principles of corporate social responsibility that have been endorsed or are supported by that Party.

Section B: Investor-State Dispute Settlement

Article 9.18: Consultation and Negotiation

1. In the event of an investment dispute, the claimant and the respondent should initially seek to resolve the dispute through consultation and negotiation, which may include the use of non-binding, third party procedures, such as good offices, conciliation or mediation.

2. The claimant shall deliver to the respondent a written request for consultations setting out a brief description of facts regarding the measure or measures at issue.

3. For greater certainty, the initiation of consultations and negotiations shall not be construed as recognition of the jurisdiction of the tribunal.

Article 9.19: Submission of a Claim to Arbitration

1. If an investment dispute has not been resolved within six months of the receipt by the respondent of a written request for consultations pursuant to Article 9.18.2 (Consultation and Negotiation):

(a) the claimant, on its own behalf, may submit to arbitration under this Section a claim:

(i) that the respondent has breached:

(A) an obligation under Section A;

(B) an investment authorisation; or

(C) an investment agreement; and

(ii) that the claimant has incurred loss or damage by reason of, or arising out of, that breach; and

(b) the claimant, on behalf of an enterprise of the respondent that is a juridical person that the claimant owns or controls directly or indirectly, may submit to arbitration under this Section a claim:

(i) that the respondent has breached:

(A) an obligation under Section A;

(B) an investment authorisation; or

(C) an investment agreement; and

(ii) that the enterprise has incurred loss or damage by reason of, or arising out of, that breach, provided that a claimant may submit pursuant to subparagraph (a)(i)(C) or (b)(i)(C) a claim for breach of an investment agreement only if the subject matter of the claim and the claimed damages directly relate to the covered investment that was established or acquired, or sought to be established or acquired, in reliance on the relevant investment agreement.

2. When the claimant submits a claim pursuant to paragraph 1(a)(i)(B), 1(a)(i)(C), 1(b)(i)(B) or 1(b)(i)(C), the respondent may make a counterclaim in connection with the factual and legal basis of the claim or rely on a claim for the purpose of a set off against the claimant.32

3. At least 90 days before submitting any claim to arbitration under this Section, the claimant shall deliver to the respondent a written notice of its intention to submit a claim to arbitration (notice of intent). The notice shall specify:

(a) the name and address of the claimant and, if a claim is submitted on behalf of an enterprise, the name, address and place of incorporation of the enterprise;

(b) for each claim, the provision of this Agreement, investment authorisation or investment agreement alleged to have been breached and any other relevant provisions;

(c) the legal and factual basis for each claim; and

(d) the relief sought and the approximate amount of damages claimed.

4. The claimant may submit a claim referred to in paragraph 1 under one of the following alternatives:

(a) the ICSID Convention and the ICSID Rules of Procedure for Arbitration Proceedings, provided that both the respondent and the Party of the claimant are parties to the ICSID Convention;

(b) the ICSID Additional Facility Rules, provided that either the respondent or the Party of the claimant is a party to the ICSID Convention;

(c) the UNCITRAL Arbitration Rules; or

(d) if the claimant and respondent agree, any other arbitral institution or any other arbitration rules.

5. A claim shall be deemed submitted to arbitration under this Section when the claimant's notice of or request for arbitration (notice of arbitration):

(a) referred to in the ICSID Convention is received by the Secretary General;

(b) referred to in the ICSID Additional Facility Rules is received by the Secretary-General;

(c) referred to in the UNCITRAL Arbitration Rules, together with the statement of claim referred to therein, are received by the respondent; or

(d) referred to under any arbitral institution or arbitration rules selected under paragraph 4(d) is received by the respondent. A claim asserted by the claimant for the first time after such notice of arbitration is submitted shall be deemed submitted to arbitration under this Section on the date of its receipt under the applicable arbitration rules.

6. The arbitration rules applicable under paragraph 4 that are in effect on the date the claim or claims were submitted to arbitration under this Section shall govern the arbitration except to the extent modified by this Agreement.

7. The claimant shall provide with the notice of arbitration:

(a) the name of the arbitrator that the claimant appoints; or

(b) the claimant's written consent for the Secretary-General to appoint that arbitrator.

Article 9.20: Consent of Each Party to Arbitration

1. Each Party consents to the submission of a claim to arbitration under this Section in accordance with this Agreement.

2. The consent under paragraph 1 and the submission of a claim to arbitration under this Section shall be deemed to satisfy the requirements of:

(a) Chapter II of the ICSID Convention (Jurisdiction of the Centre) and the ICSID Additional Facility Rules for written consent of the parties to the dispute;

(b) Article II of the New York Convention for an "agreement in writing"; and

(c) Article I of the Inter-American Convention for an "agreement".

Article 9.21: Conditions and Limitations on Consent of Each Party

1. No claim shall be submitted to arbitration under this Section if more than three years and six months have elapsed from the date on which the claimant first acquired, or should have first acquired, knowledge of the breach alleged under Article 9.19.1 (Submission of a Claim to Arbitration) and knowledge that the claimant (for claims brought under Article 9.19.1(a)) or the enterprise (for claims brought under Article 9.19.1(b)) has incurred loss or damage.

2. No claim shall be submitted to arbitration under this Section unless:

(a) the claimant consents in writing to arbitration in accordance with the procedures set out in this Agreement; and

(b) the notice of arbitration is accompanied:

(i) for claims submitted to arbitration under Article 9.19.1(a) (Submission of a Claim to Arbitration), by the claimant's written waiver; and

(ii) for claims submitted to arbitration under Article 9.19.1(b) (Submission of a Claim to Arbitration), by the claimant's and the enterprise's written waivers, of any right to initiate or continue before any court or administrative tribunal under the law of a Party, or any other dispute settlement procedures, any proceeding with respect to any measure alleged to constitute a breach referred to in Article 9.19 (Submission of a Claim to Arbitration).

3. Notwithstanding paragraph 2(b), the claimant (for claims brought under Article 9.19.1(a) (Submission of a Claim to Arbitration)) and the claimant or the enterprise (for claims brought under Article 9.19.1(b)) may initiate or continue an action that seeks interim injunctive relief and does not involve the payment of monetary damages before a judicial or administrative tribunal of the respondent, provided that the action is brought for the sole purpose of preserving the claimant's or the enterprise's rights and interests during the pendency of the arbitration.

Article 9.22: Selection of Arbitrators

1. Unless the disputing parties agree otherwise, the tribunal shall comprise three arbitrators, one arbitrator appointed by each of the disputing parties and the third, who shall be the presiding arbitrator, appointed by agreement of the disputing parties.

2. The Secretary-General shall serve as appointing authority for an arbitration under this Section.

3. If a tribunal has not been constituted within a period of 75 days after the date that a claim is submitted to arbitration under this Section, the Secretary General, on the request of a disputing party, shall appoint, in his or her discretion, the arbitrator or arbitrators not yet appointed. The Secretary-General shall not appoint a national of either the respondent or the Party of the claimant as the presiding arbitrator unless the disputing parties agree otherwise.

4. For the purposes of Article 39 of the ICSID Convention and Article 7 of Schedule C to the ICSID Additional Facility Rules, and without prejudice to an objection to an arbitrator on a ground other than nationality:

(a) the respondent agrees to the appointment of each individual member of a tribunal established under the ICSID Convention or the ICSID Additional Facility Rules;

(b) a claimant referred to in Article 9.19.1(a) (Submission of a Claim to Arbitration) may submit a claim to arbitration under this Section, or continue a claim, under the ICSID Convention or the ICSID Additional Facility Rules, only on condition that the claimant agrees in writing to the appointment of each individual member of the tribunal; and

(c) a claimant referred to in Article 9.19.1(b) (Submission of a Claim to Arbitration) may submit a claim to arbitration under this Section, or continue a claim, under the ICSID Convention or the ICSID Additional Facility Rules, only on condition that the claimant and the enterprise agree in writing to the appointment of each individual member of the tribunal.

5. In the appointment of arbitrators to a tribunal for claims submitted under Article 9.19.1(a)(i)(B) (Submission of a Claim to Arbitration), Article 9.19.1(b)(i)(B), Article 9.19.1(a)(i)(C) or Article 9.19.1(b)(i)(C), each disputing party shall take into account the expertise or relevant experience of particular candidates with respect to the relevant governing law under Article 9.25.2 (Governing Law). If the parties fail to agree on the appointment of the presiding arbitrator, the Secretary-General shall also take into account the expertise or relevant experience of particular candidates with respect to the relevant governing law under Article 9.25.2.

6. The Parties shall, prior to the entry into force of this Agreement, provide guidance on the application of the Code of Conduct for Dispute Settlement Proceedings under Chapter 28 (Dispute Settlement) to arbitrators selected to serve on investor-State dispute settlement tribunals pursuant to this Article, including any necessary modifications to the Code of Conduct to conform to the context of investor-State dispute settlement. The Parties shall also provide guidance on the application of other relevant rules or guidelines on conflicts of interest in international arbitration. Arbitrators shall comply with that guidance in addition to the applicable arbitral rules regarding independence and impartiality of arbitrators.

Article 9.23: Conduct of the Arbitration

1. The disputing parties may agree on the legal place of any arbitration under the arbitration rules applicable under Article 9.19.4 (Submission of a Claim to Arbitration). If the disputing parties fail to reach agreement, the tribunal shall determine the place in accordance with the applicable arbitration rules, provided

that the place shall be in the territory of a State that is a party to the New York Convention.

2. A non-disputing Party may make oral and written submissions to the tribunal regarding the interpretation of this Agreement.

3. After consultation with the disputing parties, the tribunal may accept and consider written amicus curiae submissions regarding a matter of fact or law within the scope of the dispute that may assist the tribunal in evaluating the submissions and arguments of the disputing parties from a person or entity that is not a disputing party but has a significant interest in the arbitral proceedings. Each submission shall identify the author; disclose any affiliation, direct or indirect, with any disputing party; and identify any person, government or other entity that has provided, or will provide, any financial or other assistance in preparing the submission. Each submission shall be in a language of the arbitration and comply with any page limits and deadlines set by the tribunal. The tribunal shall provide the disputing parties with an opportunity to respond to such submissions. The tribunal shall ensure that the submissions do not disrupt or unduly burden the arbitral proceedings, or unfairly prejudice any disputing party.

4. Without prejudice to a tribunal's authority to address other objections as a preliminary question, such as an objection that a dispute is not within the competence of the tribunal, including an objection to the tribunal's jurisdiction, a tribunal shall address and decide as a preliminary question any objection by the respondent that, as a matter of law, a claim submitted is not a claim for which an award in favour of the claimant may be made under Article 9.29 (Awards) or that a claim is manifestly without legal merit.

(a) An objection under this paragraph shall be submitted to the tribunal as soon as possible after the tribunal is constituted, and in no event later than the date the tribunal fixes for the respondent to submit its counter-memorial or, in the case of an amendment to the notice of arbitration, the date the tribunal fixes for the respondent to submit its response to the amendment.

(b) On receipt of an objection under this paragraph, the tribunal shall suspend any proceedings on the merits, establish a schedule for considering the objection consistent with any schedule it has established for considering any other preliminary question, and issue a decision or award on the objection, stating the grounds therefor.

(c) In deciding an objection under this paragraph that a claim submitted is not a claim for which an award in favour of the claimant may be made under Article 9.29 (Awards), the tribunal shall assume to be true the claimant's factual allegations in support of any claim in the notice of arbitration (or any amendment thereof) and, in disputes brought under the UNCITRAL Arbitration Rules, the statement of claim referred to in the relevant article of the UNCITRAL Arbitration Rules. The tribunal may also consider any relevant facts not in dispute.

(d) The respondent does not waive any objection as to competence, including an objection to jurisdiction, or any argument on the merits merely because the respondent did or did not raise an objection under this paragraph or make use of the expedited procedure set out in paragraph 5.

5. In the event that the respondent so requests within 45 days after the tribunal is constituted, the tribunal shall decide on an expedited basis an objection under paragraph 4 or any objection that the dispute is not within the tribunal's competence, including an objection that the dispute is not within the tribunal's jurisdiction. The tribunal shall suspend any proceedings on the merits and issue a decision or award on the objection, stating the grounds therefor, no later than 150 days after the date of the request. However, if a disputing party requests a hearing, the tribunal may take an additional 30 days to issue the decision or award. Regardless of whether a hearing is requested, a tribunal may, on a showing of extraordinary cause, delay issuing its decision or award by an additional brief period, which may not exceed 30 days.

6. When the tribunal decides a respondent's objection under paragraph 4 or 5, it may, if warranted, award to the prevailing disputing party reasonable costs and attorney's fees incurred in submitting or opposing the objection. In determining whether such an award is warranted, the tribunal shall consider whether either the claimant's claim or the respondent's objection was frivolous, and shall provide the disputing parties a reasonable opportunity to comment.

7. For greater certainty, if an investor of a Party submits a claim under this Section, including a claim alleging that a Party breached Article 9.6 (Minimum Standard of Treatment), the investor has the burden of proving all elements of its claims, consistent with general principles of international law applicable to international arbitration.

8. A respondent may not assert as a defence, counterclaim, right of set-off or for any other reason, that the claimant has received or will receive indemnification or other compensation for all or part of the alleged damages pursuant to an insurance or guarantee contract.

9. A tribunal may order an interim measure of protection to preserve the rights of a disputing party, or to ensure that the tribunal's jurisdiction is made fully effective, including an order to preserve evidence in the possession or control of a disputing party or to protect the tribunal's jurisdiction. A tribunal may not order attachment or enjoin the application of a measure alleged to constitute a breach referred to in Article 9.19 (Submission of a Claim to Arbitration). For the purposes of this paragraph, an order includes a recommendation.

10. In any arbitration conducted under this Section, at the request of a disputing party, a tribunal shall, before issuing a decision or award on liability, transmit its proposed decision or award to the disputing parties. Within 60 days after the tribunal transmits its proposed decision or award, the disputing parties may submit written comments to the tribunal concerning any aspect of its proposed decision or award. The tribunal shall consider any comments and issue its decision or award no later than 45 days after the expiration of the 60 day comment period.

11. In the event that an appellate mechanism for reviewing awards rendered by investor-State dispute settlement tribunals is developed in the future under other institutional arrangements, the Parties shall consider whether awards rendered under Article 9.29 (Awards) should be subject to that appellate mechanism. The Parties shall strive to ensure that any such appellate mechanism they consider adopting provides for transparency of proceedings similar to the transparency provisions established in Article 9.24 (Transparency of Arbitral Proceedings).

Article 9.24: Transparency of Arbitral Proceedings

1. Subject to paragraphs 2 and 4, the respondent shall, after receiving the following documents, promptly transmit them to the non-disputing Parties and make them available to the public:

(a) the notice of intent;

(b) the notice of arbitration;

(c) pleadings, memorials and briefs submitted to the tribunal by a disputing party and any written submissions submitted pursuant to Article 9.23.2 (Conduct of the Arbitration) and Article 9.23.3 and Article 9.28 (Consolidation);

(d) minutes or transcripts of hearings of the tribunal, if available; and (e) orders, awards and decisions of the tribunal.

2. The tribunal shall conduct hearings open to the public and shall determine, in consultation with the disputing parties, the appropriate logistical arrangements. If a disputing party intends to use information in a hearing that is designated as protected information or otherwise subject to paragraph 3 it shall so advise the tribunal. The tribunal shall make appropriate arrangements to protect such information from disclosure which may include closing the hearing for the duration of the discussion of that information.

3. Nothing in this Section, including paragraph 4(d), requires a respondent to make available to the public or otherwise disclose during or after the arbitral proceedings, including the hearing, protected information, or to furnish or allow access to information that it may withhold in accordance with Article 29.2 (Security Exceptions) or Article 29.7 (Disclosure of Information).

4. Any protected information that is submitted to the tribunal shall be protected from disclosure in accordance with the following procedures:

(a) subject to subparagraph (d), neither the disputing parties nor the tribunal shall disclose to any non-disputing Party or to the public any protected information if the disputing party that provided the information clearly designates it in accordance with subparagraph (b);

(b) any disputing party claiming that certain information constitutes protected information shall clearly designate the information according to any schedule set by the tribunal;

(c) a disputing party shall, according to any schedule set by the tribunal, submit a redacted version of the document that does not contain the protected information. Only the redacted version shall be disclosed in accordance with paragraph 1; and

(d) the tribunal, subject to paragraph 3, shall decide any objection regarding the designation of information claimed to be protected information. If the tribunal determines that the information was not properly designated, the disputing party that submitted the information may:

(i) withdraw all or part of its submission containing that information; or

(ii) agree to resubmit complete and redacted documents with corrected designations in accordance with the tribunal's determination and subparagraph (c). In either case, the other disputing party shall, whenever necessary, resubmit complete and redacted documents which either remove the information withdrawn under subparagraph (d)(i) by the disputing party that first submitted the information or redesignate the information consistent with the designation under subparagraph (d)(ii) of the disputing party that first submitted the information.

5. Nothing in this Section requires a respondent to withhold from the public information required to be disclosed by its laws. The respondent should endeavour to apply those laws in a manner sensitive to protecting from disclosure information that has been designated as protected information.

Article 9.25: Governing Law

1. Subject to paragraph 3, when a claim is submitted under Article 9.19.1(a)(i)(A) (Submission of a Claim to Arbitration) or Article 9.19.1(b)(i)(A), the tribunal shall decide the issues in dispute in accordance with this Agreement and applicable rules of international law.

2. Subject to paragraph 3 and the other provisions of this Section, when a claim is submitted under Article 9.19.1(a)(i)(B) (Submission of a Claim to Arbitration), Article 9.19.1(a)(i)(C), Article 9.19.1(b)(i)(B) or Article 9.19.1(b)(i)(C), the tribunal shall apply:

(a) the rules of law applicable to the pertinent investment authorisation or specified in the pertinent investment authorisation or investment agreement, or as the disputing parties may agree otherwise; or

(b) if, in the pertinent investment agreement the rules of law have not been specified or otherwise agreed:

(i) the law of the respondent, including its rules on the conflict of laws; and

(ii) such rules of international law as may be applicable.

3. A decision of the Commission on the interpretation of a provision of this Agreement under Article 27.2.2(f) (Functions of the Commission) shall be binding on a tribunal, and any decision or award issued by a tribunal must be consistent with that decision.

Article 9.26: Interpretation of Annexes

1. If a respondent asserts as a defence that the measure alleged to be a breach is within the scope of a non-conforming measure set out in Annex I or Annex II, the tribunal shall, on request of the respondent, request the interpretation of the Commission on the issue. The Commission shall submit in writing any decision on its interpretation under Article 27.2.2(f) (Functions of the Commission) to the tribunal within 90 days of delivery of the request.

2. A decision issued by the Commission under paragraph 1 shall be binding on the tribunal, and any decision or award issued by the tribunal must be consistent with that decision. If the Commission fails to issue such a decision within 90 days, the tribunal shall decide the issue.

Article 9.27: Expert Reports

Without prejudice to the appointment of other kinds of experts when authorised by the applicable arbitration rules, a tribunal, on request of a disputing party or, unless the disputing parties disapprove, on its own initiative, may appoint one or more experts to report to it in writing on any factual issue concerning scientific matters raised by a disputing party in a proceeding, subject to any terms and conditions that the disputing parties may agree.

Article 9.28: Consolidation

1. If two or more claims have been submitted separately to arbitration under Article 9.19.1 (Submission of a Claim to Arbitration) and the claims have a question of law or fact in common and arise out of the same events or circumstances, any disputing party may seek a consolidation order in accordance with the agreement of all the disputing parties sought to be covered by the order or the terms of paragraphs 2 through 10.

2. A disputing party that seeks a consolidation order under this Article shall deliver, in writing, a request to the Secretary-General and to all the disputing parties sought to be covered by the order and shall specify in the request:

(a) the names and addresses of all the disputing parties sought to be covered by the order;

(b) the nature of the order sought; and

(c) the grounds on which the order is sought.

3. Unless the Secretary-General finds within a period of 30 days after the date of receiving a request under paragraph 2 that the request is manifestly unfounded, a tribunal shall be established under this Article.

4. Unless all the disputing parties sought to be covered by the order agree otherwise, a tribunal established under this Article shall comprise three arbitrators:

(a) one arbitrator appointed by agreement of the claimants;

(b) one arbitrator appointed by the respondent; and

(c) the presiding arbitrator appointed by the Secretary-General, provided that the presiding arbitrator is not a national of the respondent or of a Party of any claimant.

5. If, within a period of 60 days after the date when the Secretary-General receives a request made under paragraph 2, the respondent fails or the claimants fail to appoint an arbitrator in accordance with paragraph 4, the Secretary General, on request of any disputing party sought to be covered by the order, shall appoint, in his or her discretion, the arbitrator or arbitrators not yet appointed.

6. If a tribunal established under this Article is satisfied that two or more claims that have been submitted to arbitration under Article 9.19.1 (Submission of a Claim to Arbitration) have a question of law or fact in common, and arise out of the same events or circumstances, the tribunal may, in the interest of fair and efficient resolution of the claims, and after hearing the disputing parties, by order:

(a) assume jurisdiction over, and hear and determine together, all or part of the claims;

(b) assume jurisdiction over, and hear and determine one or more of the claims, the determination of which it believes would assist in the resolution of the others; or

(c) instruct a tribunal previously established under Article 9.22 (Selection of Arbitrators) to assume jurisdiction over, and hear and determine together, all or part of the claims, provided that:

(i) that tribunal, on request of a claimant that was not previously a disputing party before that tribunal, shall be reconstituted with its original members, except that the arbitrator for the claimants shall be appointed pursuant to paragraphs 4(a) and 5; and

(ii) that tribunal shall decide whether a prior hearing shall be repeated.

7. If a tribunal has been established under this Article, a claimant that has submitted a claim to arbitration under Article 9.19.1 (Submission of a Claim to Arbitration) and that has not been named in a request made under paragraph 2 may make a written request to the tribunal that it be included in any order made under paragraph 6. The request shall specify:

(a) the name and address of the claimant;

(b) the nature of the order sought; and

(c) the grounds on which the order is sought.

The claimant shall deliver a copy of its request to the Secretary-General.

8. A tribunal established under this Article shall conduct its proceedings in accordance with the UNCITRAL Arbitration Rules, except as modified by this Section.

9. A tribunal established under Article 9.22 (Selection of Arbitrators) shall not have jurisdiction to decide a claim, or a part of a claim, over which a tribunal established or instructed under this Article has assumed jurisdiction.

10. On the application of a disputing party, a tribunal established under this Article, pending its decision under paragraph 6, may order that the proceedings of a tribunal established under Article 9.22 (Selection of Arbitrators) be stayed, unless the latter tribunal has already adjourned its proceedings.

Article 9.29: Awards

1. When a tribunal makes a final award, the tribunal may award, separately or in combination, only:

(a) monetary damages and any applicable interest; and

(b) restitution of property, in which case the award shall provide that the respondent may pay monetary damages and any applicable interest in lieu of restitution.

2. For greater certainty, if an investor of a Party submits a claim to arbitration under Article 9.19.1(a) (Submission of a Claim to Arbitration), it may recover only for loss or damage that it has incurred in its capacity as an investor of a Party.

3. A tribunal may also award costs and attorney's fees incurred by the disputing parties in connection with the arbitral proceeding, and shall determine how and by whom those costs and attorney's fees shall be paid, in accordance with this Section and the applicable arbitration rules.

4. For greater certainty, for claims alleging the breach of an obligation under Section A with respect to an attempt to make an investment, when an award is made in favour of the claimant, the only damages that may be awarded are those that the claimant has proven were sustained in the attempt to make the investment, provided that the claimant also proves that the breach was the proximate cause of those damages. If the tribunal determines such claims to be frivolous, the tribunal may award to the respondent reasonable costs and attorney's fees.

5. Subject to paragraph 1, if a claim is submitted to arbitration under Article 9.19.1(b) (Submission of a Claim to Arbitration) and an award is made in favour of the enterprise:

(a) an award of restitution of property shall provide that restitution be made to the enterprise;

(b) an award of monetary damages and any applicable interest shall provide that the sum be paid to the enterprise; and

(c) the award shall provide that it is made without prejudice to any right that any person may have under applicable domestic law with respect to the relief provided in the award.

6. A tribunal shall not award punitive damages.

7. An award made by a tribunal shall have no binding force except between the disputing parties and in respect of the particular case.

8. Subject to paragraph 9 and the applicable review procedure for an interim award, a disputing party shall abide by and comply with an award without delay.

9. A disputing party shall not seek enforcement of a final award until:

(a) in the case of a final award made under the ICSID Convention:

(i) 120 days have elapsed from the date the award was rendered and no disputing party has requested revision or annulment of the award; or

(ii) revision or annulment proceedings have been completed; and

(b) in the case of a final award under the ICSID Additional Facility Rules, the UNCITRAL Arbitration Rules, or the rules selected pursuant to Article 9.19.4(d) (Submission of a Claim to Arbitration):

(i) 90 days have elapsed from the date the award was rendered and no disputing party has commenced a proceeding to revise, set aside or annul the award; or

(ii) a court has dismissed or allowed an application to revise, set aside or annul the award and there is no further appeal.

10. Each Party shall provide for the enforcement of an award in its territory.

11. If the respondent fails to abide by or comply with a final award, on delivery of a request by the Party of the claimant, a panel shall be established under Article 28.7 (Establishment of a Panel). The requesting Party may seek in those proceedings:

(a) a determination that the failure to abide by or comply with the final award is inconsistent with the obligations of this Agreement; and

(b) in accordance with Article 28.17 (Initial Report), a recommendation that the respondent abide by or comply with the final award.

12. A disputing party may seek enforcement of an arbitration award under the ICSID Convention, the New York Convention or the Inter-American Convention regardless of whether proceedings have been taken under paragraph 11.

13. A claim that is submitted to arbitration under this Section shall be considered to arise out of a commercial relationship or transaction for the purposes of Article I of the New York Convention and Article I of the Inter American Convention.

Article 9.30: Service of Documents

Delivery of notice and other documents to a Party shall be made to the place named for that Party in Annex 9-D (Service of Documents on a Party Under Section B). A Party shall promptly make publicly available and notify the other Parties of any change to the place referred to in that Annex.

ANNEX 9-A

CUSTOMARY INTERNATIONAL LAW

The Parties confirm their shared understanding that "customary international law" generally and as specifically referenced in Article 9.6 (Minimum Standard of Treatment) results from a general and consistent practice of States that they follow from a sense of legal obligation. The customary international law minimum standard of treatment of aliens refers to all customary international law principles that protect the investments of aliens.

ANNEX 9-B

EXPROPRIATION

The Parties confirm their shared understanding that:

1. An action or a series of actions by a Party cannot constitute an expropriation unless it interferes with a tangible or intangible property right or property interest in an investment.

2. Article 9.8.1 (Expropriation and Compensation) addresses two situations. The first is direct expropriation, in which an investment is nationalised or otherwise directly expropriated through formal transfer of title or outright seizure.

3. The second situation addressed by Article 9.8.1 (Expropriation and Compensation) is indirect expropriation, in which an action or series of actions by a Party has an effect equivalent to direct expropriation without formal transfer of title or outright seizure.

(a) The determination of whether an action or series of actions by a Party, in a specific fact situation, constitutes an indirect expropriation, requires a case-by-case, fact-based inquiry that considers, among other factors:

(i) the economic impact of the government action, although the fact that an action or series of actions by a Party has an adverse effect on the economic value of an investment, standing alone, does not establish that an indirect expropriation has occurred;

(ii) the extent to which the government action interferes with distinct, reasonable investment-backed expectations; and

(iii) the character of the government action.

(b) Non-discriminatory regulatory actions by a Party that are designed and applied to protect legitimate public welfare objectives, such as public health, safety and the environment, do not constitute indirect expropriations, except in rare circumstances.

ANNEX 9-C

EXPROPRIATION RELATING TO LAND

1. Notwithstanding the obligations under Article 9.8 (Expropriation and Compensation), where Singapore is the expropriating Party, any measure of direct expropriation relating to land shall be for a purpose and upon payment of compensation at market value, in accordance with the applicable domestic legislation38 and any subsequent amendments thereto relating to the amount of compensation where such amendments provide for the method of determination of the compensation which is no less favourable to the investor for its expropriated investment than such method of determination in the applicable domestic legislation as at the time of entry into force of this Agreement for Singapore.

2. Notwithstanding the obligations under Article 9.8 (Expropriation and Compensation), where Viet Nam is the expropriating Party, any measure of direct expropriation relating to land shall be: (i) for a purpose in accordance with the applicable domestic legislation; and (ii) upon payment of compensation equivalent to the market value, while recognising the applicable domestic legislation.

ANNEX 9-D

SERVICE OF DOCUMENTS ON A PARTY UNDER SECTION B (INVESTOR-STATE DISPUTE SETTLEMENT)

Australia

Notices and other documents in disputes under Section B (Investor-State Dispute Settlement) shall be served on Australia by delivery to:

Department of Foreign Affairs and Trade

R.G. Casey Building

John McEwen Crescent

Barton ACT 0221

Australia

Brunei Darussalam

Notices and other documents in disputes under Section B (Investor-State Dispute Settlement) shall be served on Brunei Darussalam by delivery to:

The Permanent Secretary (Trade)

Ministry of Foreign Affairs and Trade

Jalan Subok

Bandar Seri Begawan, BD 2710

Brunei Darussalam

Canada

Notices and other documents in disputes under Section B (Investor-State Dispute Settlement) shall be served on Canada by delivery to:

Office of the Deputy Attorney General of Canada

Justice Building

239 Wellington Street

Ottawa, Ontario

K1A 0H8

Canada

Chile

Notices and other documents in disputes under Section B (Investor-State Dispute Settlement) shall be served on Chile by delivery to:

Dirección de Asuntos Jurídicos del Ministerio de Relaciones Exteriores de la República de Chile

Teatinos 180

Santiago

Chile

Japan

Notices and other documents in disputes under Section B (Investor-State Dispute Settlement) shall be served on Japan by delivery to:

Economic Affairs Bureau

Ministry of Foreign Affairs

2-2-1 Kasumigaseki, Chiyoda-ku

Tokyo

Japan

Malaysia

Notices and other documents in disputes under Section B (Investor-State Dispute Settlement) shall be served on Malaysia by delivery to:

Attorney General's Chambers

Level 16, No. 45 Persiaran Perdana

Precint 4

Federal Government Administrative Centre

62100 Putrajaya

Malaysia

Mexico

Notices and other documents in disputes under Section B (Investor-State Dispute Settlement) shall be served on Mexico by delivery to:

Dirección General de Consultoría Jurídica de Comercio Internacional Secretaría de Economía

Alfonso Reyes #30, piso 17

Col. Hipódromo Condesa

Del. Cuauhtémoc

México D.F.

C.P. 06140

New Zealand

Notices and other documents in disputes under Section B (Investor-State Dispute Settlement) shall be served on New Zealand by delivery to:

The Secretary

Ministry of Foreign Affairs and Trade

195 Lambton Quay

Wellington 6011

New Zealand

Peru

Notices and other documents in disputes under Section B (Investor-State Dispute Settlement) shall be served on Peru by delivery to:

Dirección General de Asuntos de Economía Internacional,

Competencia y Productividad

Ministerio de Economía y Finanzas

Jirón Lampa 277, piso 5

Lima, Perú

Singapore

Notices and other documents in disputes under Section B (Investor-State Dispute Settlement) shall be served on Singapore by delivery to:

Permanent Secretary

Ministry of Trade & Industry

100 High Street #09-01

Singapore 179434

Singapore

United States

Notices and other documents in disputes under Section B (Investor-State Dispute Settlement) shall be served on the United States by delivery to:

Executive Director (L/EX)

Office of the Legal Adviser

Department of State

Washington, D.C.20520

United States of America

Viet Nam

Notices and other documents in disputes under Section B (Investor-State Dispute Settlement) shall be served on Viet Nam by delivery to:

General Director

Department of International Law

Ministry of Justice

60 Tran Phu Street

Ba Dinh District

Ha Noi


ANNEX 9-E

TRANSFERS

Chile

1. Notwithstanding Article 9.9 (Transfers), Chile reserves the right of the Central Bank of Chile (Banco Central de Chile) to maintain or adopt measures in conformity with Law 18.840, Constitutional Organic Law of the Central Bank of Chile (Ley 18.840, Ley Orgánica Constitucional del Banco Central de Chile), and Decreto con Fuerza de Ley No3 de 1997, Ley General de Bancos (General Banking Act) and Ley 18.045, Ley de Mercado de Valores (Securities Market Law), in order to ensure currency stability and the normal operation of domestic and foreign payments. Such measures include, inter alia, the establishment of restrictions or limitations on current payments and transfers (capital movements) to or from Chile, as well as transactions related to them, such as requiring that deposits, investments or credits from or to a foreign country, be subject to a reserve requirement (encaje).

2. Notwithstanding paragraph 1, the reserve requirements that the Central Bank of Chile can apply pursuant to Article 49 No. 2 of Law 18.840, shall not exceed 30 per cent of the amount transferred and shall not be imposed for a period which exceeds two years.


ANNEX 9-F

DL 600

Chile

1. The obligations and commitments contained in this Chapter do not apply to Decree Law 600, Foreign Investment Statute (Decreto Ley 600, Estatuto de la Inversión Extranjera) (hereinafter referred to in this Annex as "DL 600"), or its successors, and to Law 18.657, Foreign Capital Investment Fund Law (Ley 18.657, Ley de Fondos de Inversión de Capital Extranjero), with respect to:

(a) The right of the Foreign Investment Committee of Chile (Comité de Inversiones Extranjeras) or its successor to accept or reject applications to invest through an investment contract under DL 600 and the right to regulate the terms and conditions of foreign investment under DL 600 and Law 18.657.

(b) The right to maintain existing requirements that transfers from Chile of proceeds from the sale of all or any part of an investment of an investor of a Party or from the partial or complete liquidation of the investment which may not take place until a period not to exceed:

(i) in the case of an investment made pursuant to DL 600, one year from the date of transfer to Chile; or

(ii) in the case of an investment made pursuant to Law 18.657, five years from the date of transfer to Chile.

(c) The right to adopt measures, consistent with this Annex, establishing future special voluntary investment programmes in addition to the general regime for foreign investment in Chile, except that any such measures may restrict transfers from Chile of proceeds from the sale of all or any part of an investment of an investor of another Party or from the partial or complete liquidation of the investment for a period not to exceed five years from the date of transfer to Chile.

2. For greater certainty, except to the extent that paragraph 1(b) or (c) provides an exception to Article 9.9 (Transfers), the investment entered through an investment contract under DL 600, through Law 18.657 or through any future special voluntary investment programme, will be subject to the obligations and commitments of this Chapter, to the extent that the investment is a covered investment under Chapter 9 (Investment).


ANNEX 9-G

PUBLIC DEBT

1. The Parties recognise that the purchase of debt issued by a Party entails commercial risk. For greater certainty, no award shall be made in favour of a claimant for a claim under Article 9.19.1(a)(i)(A) (Submission of a Claim to Arbitration) or Article 9.19.1(b)(i)(A) with respect to default or non-payment of debt issued by a Party unless the claimant meets its burden of proving that such default or non-payment constitutes a breach of an obligation under Section A, including an uncompensated expropriation pursuant to Article 9.8 (Expropriation and Compensation).

2. No claim that a restructuring of debt issued by a Party breaches an obligation under Section A shall be submitted to, or if already submitted continue in, arbitration under Section B (Investor-State Dispute Settlement) if the restructuring is a negotiated restructuring at the time of submission, or becomes a negotiated restructuring after that submission, except for a claim that the restructuring violates Article 9.4 (National Treatment) or Article 9.5 (Most

Favoured-Nation Treatment).

3. Notwithstanding Article 9.19.4 (Submission of a Claim to Arbitration), and subject to paragraph 2, an investor of another Party shall not submit a claim under Section B (Investor-State Dispute Settlement) that a restructuring of debt issued by a Party breaches an obligation under Section A, other than Article 9.4 (National Treatment) or Article 9.5 (Most-Favoured-Nation Treatment), unless 270 days have elapsed from the date of receipt by the respondent of the written request for consultations pursuant to Article 9.18.2 (Consultation and Negotiation).


ANNEX 9-H

1. A decision under Australia's foreign investment policy, which consists of the Foreign Acquisitions and Takeovers Act 1975, Foreign Acquisitions and Takeovers Regulations 1989, Financial Sector (Shareholdings) Act 1998 and associated Ministerial Statements by the Treasurer of the Commonwealth of Australia or a minister acting on his or her behalf, on whether or not to approve a foreign investment proposal, shall not be subject to the dispute settlement provisions under Section B (Investor-State Dispute Settlement) or Chapter 28 (Dispute Settlement).

2. A decision by Canada following a review under the Investment Canada Act (R.S.C. 1985, c.28 (1st Supp.)), with respect to whether or not to permit an investment that is subject to review, shall not be subject to the dispute settlement provisions under Section B (Investor-State Dispute Settlement) or Chapter 28 (Dispute Settlement).

3. A decision by the National Commission on Foreign Investment (Comisión Nacional de Inversiones Extranjeras) following a review pursuant to the entry at Annex I – Mexico – 6 with respect to whether or not to permit an acquisition that is subject to review, shall not be subject to the dispute settlement provisions of Section B (Investor-State Dispute Settlement) or Chapter 28 (Dispute Settlement).

4. A decision under New Zealand's Overseas Investment Act 2005 to grant consent, or to decline to grant consent, to an overseas investment transaction that requires prior consent under that Act shall not be subject to the dispute settlement provisions under Section B (Investor-State Dispute Settlement) or Chapter 28 (Dispute Settlement).


ANNEX 9-I

NON-CONFORMING MEASURES RATCHET MECHANISM

Notwithstanding Article 9.12.1(c) (Non-Conforming Measures), for Viet Nam for three years after the date of entry into force of this Agreement for it:

(a) Article 9.4 (National Treatment), Article 9.5 (Most-Favoured Nation Treatment), Article 9.10 (Performance Requirements) and Article 9.11 (Senior Management and Boards of Directors) shall not apply to an amendment to any non-conforming measure referred to in Article 9.12.1(a) (Non-Conforming Measures) to the extent that the amendment does not decrease the conformity of the measure, as it existed at the date of entry into force of this Agreement for Viet Nam, with Article 9.4 (National Treatment), Article 9.5 (Most-Favoured-Nation Treatment), Article 9.10 (Performance Requirements) or Article 9.11 (Senior Management and Boards of Directors);

(b) Viet Nam shall not withdraw a right or benefit from an investor or covered investment of another Party, in reliance on which the investor or covered investment has taken any concrete action, through an amendment to any non-conforming measure referred to in Article 9.12.1(a) (Non-Conforming Measures) that decreases the conformity of the measure as it existed immediately before the amendment; and

(c) Viet Nam shall provide to the other Parties the details of any amendment to a non-conforming measure referred to in Article 9.12.1(a) (Non-Conforming Measures) that would decrease the conformity of the measure, as it existed immediately before the amendment, at least 90 days before making the amendment.


ANNEX 9-J

SUBMISSION OF A CLAIM TO ARBITRATION

1. An investor of a Party may not submit to arbitration under Section B (Investor-State Dispute Settlement) a claim that Chile, Mexico, Peru or Viet Nam has breached an obligation under Section A either:

(a) on its own behalf under Article 9.19.1(a) (Submission of a Claim to Arbitration); or

(b) on behalf of an enterprise of Chile, Mexico, Peru, or Viet Nam, that is a juridical person that the investor owns or controls directly or indirectly under 9.19.1(b) (Submission of a Claim to Arbitration),

if the investor or the enterprise, respectively, has alleged that breach of an obligation under Section A in proceedings before a court or administrative tribunal of Chile, Mexico, Peru or Viet Nam.

2. For greater certainty, if an investor of a Party elects to submit a claim of the type described in paragraph 1 to a court or administrative tribunal of Chile, Mexico, Peru or Viet Nam, that election shall be definitive and exclusive, and the investor may not thereafter submit the claim to arbitration under Section B (Investor-State Dispute Settlement).


ANNEX 9-K

SUBMISSION OF CERTAIN CLAIMS

FOR THREE YEARS AFTER ENTRY INTO FORCE

Malaysia

Without prejudice to a claimant's right to submit other claims to arbitration pursuant to Article 9.19 (Submission of a Claim to Arbitration), Malaysia does not consent to the submission of a claim that Malaysia has breached a government procurement contract with a covered investment, below the specified contract value, for a period of three years after the date of entry into force of this Agreement for Malaysia. The specified contract values are: (a) for goods, SDR 1,500,000; (b) for services, SDR 2,000,000; and (c) for construction, SDR 63,000,000.


ANNEX 9-L

INVESTMENT AGREEMENTS

A. Agreements with selected international arbitration clauses

1. An investor of a Party may not submit to arbitration a claim for breach of an investment agreement under Article 9.19.1(a)(i)(C) (Submission of a Claim to Arbitration) or Article 9.19.1(b)(i)(C) if the investment agreement provides the respondent's consent for the investor to arbitrate the alleged breach of the investment agreement and further provides that:

(a) a claim may be submitted for breach of the investment agreement under at least one of the following alternatives:

(i) the ICSID Convention and the ICSID Rules of Procedure for Arbitration Proceedings, provided that both the respondent and the Party of the investor are parties to the ICSID Convention;

(ii) the ICSID Additional Facility Rules, provided that either the respondent or the Party of the investor is a party to the ICSID Convention;

(iii) the UNCITRAL Arbitration Rules;

(iv) the ICC Arbitration Rules; or

(v) the LCIA Arbitration Rules; and

(b) in the case of arbitration not under the ICSID Convention, the legal place of the arbitration shall be:

(i) in the territory of a State that is party to the New York Convention; and

(ii) outside the territory of the respondent.

2. Notwithstanding Article 9.21.2(b) (Conditions and Limitations on Consent of Each Party), if a claimant submits to arbitration a claim that the respondent has breached:

(a) an obligation under Section A pursuant to Article 9.19.1(a)(i)(A) (Submission of a Claim to Arbitration) or Article 9.19.1(b)(i)(A); or

(b) an investment authorisation pursuant to Article 9.19.1(a)(i)(B) (Submission of a Claim to Arbitration) or Article 9.19.1(b)(i)(B), the claimant's submission of a written waiver shall not preclude its right to initiate or continue an arbitration under an investment agreement, if that investment agreement meets the criteria in paragraph 1, with respect to any measure alleged to constitute a breach referred to in Article 9.19 (Submission of a Claim to Arbitration).

3. If a claimant:

(a) submits to arbitration a claim that the respondent has breached an obligation under Section A pursuant to Article 9.19.1(a)(i)(A) (Submission of a Claim to Arbitration) or Article 9.19.1(b)(i)(A) or an investment authorisation pursuant to Article 9.19.1(a)(i)(B) or Article 9.19.1(b)(i)(B); and

(b) submits a claim to arbitration under an investment agreement that meets the criteria in paragraph 1, and the claims have a question of law or fact in common and arise out of the same events or circumstances, any disputing party may seek a consolidation order in accordance with the agreement of all the disputing parties sought to be covered by the order or the terms of paragraphs 2 through 10 of Article 9.28 (Consolidation).

B. Certain agreements between Peru and covered investments or investors

1. Pursuant to Legislative Decrees 662 and 757, Peru may enter into agreements known as "stability agreements" with covered investments or investors of another Party.

2. As part of a stability agreement referred to in paragraph 1, Peru accords certain benefits to the covered investment or the investor that is a party to the agreement. These benefits typically include a commitment to maintain the existing income tax regime applicable to such covered investment or investor during a specified period of time.

3. A stability agreement referred to in paragraph 1 may constitute one of multiple written instruments that make up an "investment agreement", as defined in Article 9.1 (Definitions). If that is the case, a breach of such a stability agreement by Peru may constitute a breach of the investment agreement of which it is a part.

4. If a stability agreement does not constitute one of multiple instruments that make up an "investment agreement", as defined in Article 9.1 (Definitions), a breach of such a stability agreement by Peru shall not constitute a breach of an investment agreement.

C. Limitation of Mexico's consent to arbitration

1. Without prejudice to a claimant's right to submit other claims pursuant to Article 9.19 (Submission of a Claim to Arbitration), Mexico does not consent to the submission of any claim to arbitration under Article 9.19.1(a)(i)(C) or 9.19.1(b)(i)(C) if the submission to arbitration of that claim would be inconsistent with the following laws with respect to the relevant acts of authority:

(a) Hydrocarbons Law, Articles 20 and 21;

(b) Law on Public Works and Related Services, Article 98, paragraph 2;

(c) Public Private Partnerships Law, Article 139, paragraph 3;

(d) Law on Roads, Bridges, and Federal Motor Carriers, Article 80;

(e) Ports Law, Article 3, paragraph 2;

(f) Airports Law, Article 3, paragraph 2;

(g) Regulatory Law of the Railway Service, Article 4, paragraph 2;

(h) Commercial and Navigation Maritimes Law, Article 264, paragraph 2;

(i) Civil Aviation Law, Article 3, paragraph 2; and

(j) Political Constitution of the United Mexican States, Article 28, paragraph 20, subparagraph VII, and Federal Telecommunications and Broadcasting Law, Article 312, provided, however, that the application of the provisions referred to in subparagraphs (a) through (i) shall not be used as a disguised means to repudiate or breach the investment agreement.

2. If any law referred to in paragraph 1 is amended to permit the submission to arbitration of such a claim after the entry into force of this Agreement for Mexico, the limitation of Mexico's consent specified in paragraph 1 shall not apply with respect to that law.

D. Specific Canadian entities under subpart (c) of definition

For Canada, authority at the central level of government includes entities listed under Schedule III of the Financial Administration Act (R.S.C. 1985, c. F 11), and port or bridge authorities, that have concluded an investment agreement under subpart (c) of the definition of "investment agreement" only if the government directs or controls the day to day operations or activities of the entity or authority in carrying out its obligations under the investment agreement.


CHAPTER 10

CROSS-BORDER TRADE IN SERVICES

Article 10.1: Definitions

For the purposes of this Chapter:

airport operation services means the supply of air terminal, airfield and other airport infrastructure operation services on a fee or contract basis. Airport operation services do not include air navigation services;

computer reservation system services means services provided by computerised systems that contain information about air carriers' schedules, availability, fares and fare rules, through which reservations can be made or tickets may be issued;

cross-border trade in services or cross-border supply of services means the supply of a service:

(a) from the territory of a Party into the territory of another Party;

(b) in the territory of a Party to a person of another Party; or

(c) by a national of a Party in the territory of another Party,

but does not include the supply of a service in the territory of a Party by a covered investment;

enterprise means an enterprise as defined in Article 1.3 (General Definitions), and a branch of an enterprise;

enterprise of a Party means an enterprise constituted or organised under the laws of a Party, or a branch located in the territory of a Party and carrying out business activities there;

ground handling services means the supply at an airport, on a fee or contract basis, of the following services: airline representation, administration and supervision; passenger handling; baggage handling; ramp services; catering, except the preparation of the food; air cargo and mail handling; fuelling of an aircraft; aircraft servicing and cleaning; surface transport; and flight operations, crew administration and flight planning. Ground handling services do not include: self-handling; security; line maintenance; aircraft repair and maintenance; or management or operation of essential centralised airport infrastructure, such as de-icing facilities, fuel distribution systems, baggage handling systems and fixed intra-airport transport systems;

measures adopted or maintained by a Party means measures adopted or maintained by:

(a) central, regional, or local governments or authorities; or

(b) non-governmental bodies in the exercise of powers delegated by central, regional, or local governments or authorities;

selling and marketing of air transport services means opportunities for the air carrier concerned to sell and market freely its air transport services including all aspects of marketing such as market research, advertising and distribution. These activities do not include the pricing of air transport services or the applicable conditions;

service supplied in the exercise of governmental authority means, for each Party, any service that is supplied neither on a commercial basis nor in competition with one or more service suppliers;

service supplier of a Party means a person of a Party that seeks to supply or supplies a service; and

specialty air services means any specialised commercial operation using an aircraft whose primary purpose is not the transportation of goods or passengers, such as aerial fire-fighting, flight training, sightseeing, spraying, surveying, mapping, photography, parachute jumping, glider towing, and helicopter-lift for logging and construction, and other airborne agricultural, industrial and inspection services.

Article 10.2: Scope

1. This Chapter shall apply to measures adopted or maintained by a Party affecting cross-border trade in services by service suppliers of another Party. Such measures include measures affecting:

(a) the production, distribution, marketing, sale or delivery of a service;

(b) the purchase or use of, or payment for, a service;

(c) the access to and use of distribution, transport or telecommunications networks and services in connection with the supply of a service;

(d) the presence in the Party's territory of a service supplier of another Party; and

(e) the provision of a bond or other form of financial security as a condition for the supply of a service.

2. In addition to paragraph 1:

(a) Article 10.5 (Market Access), Article 10.8 (Domestic Regulation) and Article 10.11 (Transparency) shall also apply to measures adopted or maintained by a Party affecting the supply of a service in its territory by a covered investment; and

(b) Annex 10-B (Express Delivery Services) shall also apply to measures adopted or maintained by a Party affecting the supply of express delivery services, including by a covered investment.

3. This Chapter shall not apply to:

(a) financial services as defined in Article 11.1 (Definitions), except that paragraph 2(a) shall apply if the financial service is supplied by a covered investment that is not a covered investment in a financial institution as defined in Article 11.1 (Definitions) in the Party's territory;

(b) government procurement;

(c) services supplied in the exercise of governmental authority; or

(d) subsidies or grants provided by a Party, including government supported loans, guarantees and insurance.

4. This Chapter does not impose any obligation on a Party with respect to a national of another Party who seeks access to its employment market or who is employed on a permanent basis in its territory, and does not confer any right on that national with respect to that access or employment.

5. This Chapter shall not apply to air services, including domestic and international air transportation services, whether scheduled or non-scheduled, or to related services in support of air services, other than the following:

(a) aircraft repair and maintenance services during which an aircraft is withdrawn from service, excluding so-called line maintenance;

(b) selling and marketing of air transport services;

(c) computer reservation system services;

(d) specialty air services;

(e) airport operation services; and

(f) ground handling services.

6. In the event of any inconsistency between this Chapter and a bilateral, plurilateral or multilateral air services agreement to which two or more Parties are party, the air services agreement shall prevail in determining the rights and obligations of those Parties that are party to that air services agreement.

7. If two or more Parties have the same obligations under this Agreement and a bilateral, plurilateral or multilateral air services agreement, those Parties may invoke the dispute settlement procedures of this Agreement only after any dispute settlement procedures in the other agreement have been exhausted.

8. If the Annex on Air Transport Services of GATS is amended, the Parties shall jointly review any new definitions with a view to aligning the definitions in this Agreement with those definitions, as appropriate.

Article 10.3: National Treatment

1. Each Party shall accord to services and service suppliers of another Party treatment no less favourable than that it accords, in like circumstances, to its own services and service suppliers.

2. For greater certainty, the treatment to be accorded by a Party under paragraph 1 means, with respect to a regional level of government, treatment no less favourable than the most favourable treatment accorded, in like circumstances, by that regional level of government to service suppliers of the Party of which it forms a part.

Article 10.4: Most-Favoured-Nation Treatment

Each Party shall accord to services and service suppliers of another Party treatment no less favourable than that it accords, in like circumstances, to services and service suppliers of any other Party or a non-Party.

Article 10.5: Market Access

No Party shall adopt or maintain, either on the basis of a regional subdivision or on the basis of its entire territory, measures that:

(a) impose limitations on:

(i) the number of service suppliers, whether in the form of numerical quotas, monopolies, exclusive service suppliers or the requirement of an economic needs test;

(ii) the total value of service transactions or assets in the form of numerical quotas or the requirement of an economic needs test;

(iii) the total number of service operations or the total quantity of service output expressed in terms of designated numerical units in the form of quotas or the requirement of an economic needs test; or

(iv) the total number of natural persons that may be employed in a particular service sector or that a service supplier may employ and who are necessary for, and directly related to, the supply of a specific service in the form of numerical quotas or the requirement of an economic needs test; or

(b) restrict or require specific types of legal entity or joint venture through which a service supplier may supply a service.

Article 10.6: Local Presence

No Party shall require a service supplier of another Party to establish or maintain a representative office or any form of enterprise, or to be resident, in its territory as a condition for the cross-border supply of a service.

Article 10.7: Non-Conforming Measures

1. Article 10.3 (National Treatment), Article 10.4 (Most-Favoured-Nation Treatment), Article 10.5 (Market Access) and Article 10.6 (Local Presence) shall not apply to:

(a) any existing non-conforming measure that is maintained by a Party at:

(i) the central level of government, as set out by that Party in its Schedule to Annex I;

(ii) a regional level of government, as set out by that Party in its Schedule to Annex I; or

(iii) a local level of government;

(b) the continuation or prompt renewal of any non-conforming measure referred to in subparagraph (a); or

(c) an amendment to any non-conforming measure referred to in subparagraph (a), to the extent that the amendment does not decrease the conformity of the measure, as it existed immediately before the amendment, with Article 10.3 (National Treatment), Article 10.4 (Most-Favoured-Nation Treatment), Article 10.5 (Market Access) or Article 10.6 (Local Presence).

2. Article 10.3 (National Treatment), Article 10.4 (Most-Favoured-Nation Treatment), Article 10.5 (Market Access) and Article 10.6 (Local Presence) shall not apply to any measure that a Party adopts or maintains with respect to sectors, sub-sectors or activities, as set out by that Party in its Schedule to Annex II.

3 If a Party considers that a non-conforming measure applied by a regional level of government of another Party, as referred to in subparagraph 1(a)(ii), creates a material impediment to the cross-border supply of services in relation to the former Party, it may request consultations with regard to that measure. These Parties shall enter into consultations with a view to exchanging information on the operation of the measure and to considering whether further steps are necessary and appropriate.

Article 10.8: Domestic Regulation

1. Each Party shall ensure that all measures of general application affecting trade in services are administered in a reasonable, objective and impartial manner.

2. With a view to ensuring that measures relating to qualification requirements and procedures, technical standards and licensing requirements do not constitute unnecessary barriers to trade in services, while recognising the right to regulate and to introduce new regulations on the supply of services in order to meet its policy objectives, each Party shall endeavour to ensure that any such measures that it adopts or maintains are:

(a) based on objective and transparent criteria, such as competence and the ability to supply the service; and

(b) in the case of licensing procedures, not in themselves a restriction on the supply of the service.

3. In determining whether a Party is in conformity with its obligations under paragraph 2, account shall be taken of international standards of relevant international organisations applied by that Party.

4. If a Party requires authorisation for the supply of a service, it shall ensure that its competent authorities:

(a) within a reasonable period of time after the submission of an application considered complete under its laws and regulations, inform the applicant of the decision concerning the application;

(b) to the extent practicable, establish an indicative timeframe for the processing of an application;

(c) if an application is rejected, to the extent practicable, inform the applicant of the reasons for the rejection, either directly or on request, as appropriate;

(d) on request of the applicant, provide, without undue delay, information concerning the status of the application;

(e) to the extent practicable, provide the applicant with the opportunity to correct minor errors and omissions in the application and endeavour to provide guidance on the additional information required; and

(f) if they deem appropriate, accept copies of documents that are authenticated in accordance with the Party's laws in place of original documents.

5. Each Party shall ensure that any authorisation fee charged by any of its competent authorities is reasonable, transparent and does not, in itself, restrict the supply of the relevant service.

6. If licensing or qualification requirements include the completion of an examination, each Party shall ensure that:

(a) the examination is scheduled at reasonable intervals; and

(b) a reasonable period of time is provided to enable interested persons to submit an application.

7. Each Party shall ensure that there are procedures in place domestically to assess the competency of professionals of another Party.

8. Paragraphs 1 through 7 shall not apply to the non-conforming aspects of measures that are not subject to the obligations under Article 10.3 (National Treatment) or Article 10.5 (Market Access) by reason of an entry in a Party's Schedule to Annex I, or to measures that are not subject to the obligations under Article 10.3 (National Treatment) or Article 10.5 (Market Access) by reason of an entry in a Party's Schedule to Annex II.

9. If the results of the negotiations related to paragraph 4 of Article VI of GATS, or the results of any similar negotiations undertaken in other multilateral fora in which the Parties participate, enter into effect, the Parties shall jointly review these results with a view to bringing them into effect, as appropriate, under this Agreement.

Article 10.9: Recognition

1. For the purposes of the fulfilment, in whole or in part, of a Party's standards or criteria for the authorisation, licensing or certification of service suppliers, and subject to the requirements of paragraph 4, it may recognise the education or experience obtained, requirements met, or licences or certifications granted, in the territory of another Party or a non-Party. That recognition, which may be achieved through harmonisation or otherwise, may be based on an agreement or arrangement with the Party or non-Party concerned, or may be accorded autonomously.

2. If a Party recognises, autonomously or by agreement or arrangement, the education or experience obtained, requirements met, or licences or certifications granted, in the territory of another Party or a non-Party, nothing in Article 10.4 (Most-Favoured-Nation Treatment) shall be construed to require the Party to accord recognition to the education or experience obtained, requirements met, or licences or certifications granted, in the territory of any other Party.

3. A Party that is a party to an agreement or arrangement of the type referred to in paragraph 1, whether existing or future, shall afford adequate opportunity to another Party, on request, to negotiate its accession to that agreement or arrangement, or to negotiate a comparable agreement or arrangement. If a Party accords recognition autonomously, it shall afford adequate opportunity to another Party to demonstrate that education, experience, licences or certifications obtained or requirements met in that other Party's territory should be recognised.

4. A Party shall not accord recognition in a manner that would constitute a means of discrimination between Parties or between Parties and non-Parties in the application of its standards or criteria for the authorisation, licensing or certification of service suppliers, or a disguised restriction on trade in services.

5. As set out in Annex 10-A (Professional Services), the Parties shall endeavour to facilitate trade in professional services, including through the establishment of a Professional Services Working Group.

Article 10.10: Denial of Benefits

1. A Party may deny the benefits of this Chapter to a service supplier of another Party if the service supplier is an enterprise owned or controlled by persons of a non-Party, and the denying Party adopts or maintains measures with respect to the non-Party or a person of the non-Party that prohibit transactions with the enterprise or that would be violated or circumvented if the benefits of this Chapter were accorded to the enterprise.

2. A Party may deny the benefits of this Chapter to a service supplier of another Party if the service supplier is an enterprise owned or controlled by persons of a non-Party or by persons of the denying Party that has no substantial business activities in the territory of any Party other than the denying Party.

Article 10.11: Transparency

1. Each Party shall maintain or establish appropriate mechanisms for responding to inquiries from interested persons regarding its regulations that relate to the subject matter of this Chapter.8

2. If a Party does not provide advance notice and opportunity for comment pursuant to Article 26.2.2 (Publication) with respect to regulations that relate to the subject matter in this Chapter, it shall, to the extent practicable, provide in writing or otherwise notify interested persons of the reasons for not doing so.

3. To the extent possible, each Party shall allow reasonable time between publication of final regulations and the date when they enter into effect.

Article 10.12: Payments and Transfers

1. Each Party shall permit all transfers and payments that relate to the cross border supply of services to be made freely and without delay into and out of its territory.

2. Each Party shall permit transfers and payments that relate to the cross border supply of services to be made in a freely usable currency at the market rate of exchange that prevails at the time of transfer.

3. Notwithstanding paragraphs 1 and 2, a Party may prevent or delay a transfer or payment through the equitable, non-discriminatory and good faith application of its laws that relate to:

(a) bankruptcy, insolvency or the protection of the rights of creditors;

(b) issuing, trading or dealing in securities, futures, options or derivatives;

(c) financial reporting or record keeping of transfers when necessary to assist law enforcement or financial regulatory authorities;

(d) criminal or penal offences; or

(e) ensuring compliance with orders or judgments in judicial or administrative proceedings.

Article 10.13: Other Matters

The Parties recognise the importance of air services in facilitating the expansion of trade and enhancing economic growth. Each Party may consider working with other Parties in appropriate fora toward liberalising air services, such as through agreements allowing air carriers to have flexibility to decide on their routing and frequencies.


ANNEX 10-A

PROFESSIONAL SERVICES

General Provisions

1. Each Party shall consult with relevant bodies in its territory to seek to identify professional services when two or more Parties are mutually interested in establishing dialogue on issues that relate to the recognition of professional qualifications, licensing or registration.

2. Each Party shall encourage its relevant bodies to establish dialogues with the relevant bodies of other Parties, with a view to recognising professional qualifications, and facilitating licensing or registration procedures.

3. Each Party shall encourage its relevant bodies to take into account agreements that relate to professional services in the development of agreements on the recognition of professional qualifications, licensing and registration.

4. A Party may consider, if feasible, taking steps to implement a temporary or project specific licensing or registration regime based on a foreign supplier's home licence or recognised professional body membership, without the need for further written examination. That temporary or limited licence regime should not operate to prevent a foreign supplier from gaining a local licence once that supplier satisfies the applicable local licensing requirements.

Engineering and Architectural Services

5. Further to paragraph 3, the Parties recognise the work in APEC to promote the mutual recognition of professional competence in engineering and architecture, and the professional mobility of these professions, under the APEC Engineer and APEC Architect frameworks.

6. Each Party shall encourage its relevant bodies to work towards becoming authorised to operate APEC Engineer and APEC Architect Registers.

7. A Party shall encourage its relevant bodies operating APEC Engineer or APEC Architect Registers to enter into mutual recognition arrangements with the relevant bodies of other Parties operating those registers.

Temporary Licensing or Registration of Engineers

8. Further to paragraph 4, in taking steps to implement a temporary or project-specific licensing or registration regime for engineers, a Party shall consult with its relevant professional bodies with respect to any recommendations for:

(a) the development of procedures for the temporary licensing or registration of engineers of another Party to permit them to practise their engineering specialties in its territory;

(b) the development of model procedures for adoption by the competent authorities throughout its territory to facilitate the temporary licensing or registration of those engineers;

(c) the engineering specialties to which priority should be given in developing temporary licensing or registration procedures; and

(d) other matters relating to the temporary licensing or registration of engineers identified in the consultations.

Legal Services

9. The Parties recognise that transnational legal services that cover the laws of multiple jurisdictions play an essential role in facilitating trade and investment and in promoting economic growth and business confidence.

10. If a Party regulates or seeks to regulate foreign lawyers and transnational legal practice, the Party shall encourage its relevant bodies to consider, subject to its laws and regulations, whether or in what manner:

(a) foreign lawyers may practise foreign law on the basis of their right to practise that law in their home jurisdiction;

(b) foreign lawyers may prepare for and appear in commercial arbitration, conciliation and mediation proceedings;

(c) local ethical, conduct and disciplinary standards are applied to foreign lawyers in a manner that is no more burdensome for foreign lawyers than the requirements imposed on domestic (host country) lawyers;

(d) alternatives for minimum residency requirements are provided for foreign lawyers, such as requirements that foreign lawyers disclose to clients their status as a foreign lawyer, or maintain professional indemnity insurance or alternatively disclose to clients that they lack that insurance;

(e) the following modes of providing transnational legal services are accommodated:

(i) on a temporary fly-in, fly-out basis;

(ii) through the use of web-based or telecommunications

technology;

(iii) by establishing a commercial presence; and

(iv) through a combination of fly-in, fly-out and one or both of the other modes listed in subparagraphs (ii) and (iii);

(f) foreign lawyers and domestic (host country) lawyers may work together in the delivery of fully integrated transnational legal services; and

(g) a foreign law firm may use the firm name of its choice.

Professional Services Working Group

11. The Parties hereby establish a Professional Services Working Group (Working Group), composed of representatives of each Party, to facilitate the activities listed in paragraphs 1 through 4.

12. The Working Group shall liaise, as appropriate, to support the Parties' relevant professional and regulatory bodies in pursuing the activities listed in paragraphs 1 through 4. This support may include providing points of contact, facilitating meetings and providing information regarding regulation of professional services in the Parties' territories.

13. The Working Group shall meet annually, or as agreed by the Parties, to discuss progress towards the objectives in paragraphs 1 through 4. For a meeting to be held, at least two Parties must participate. It is not necessary for representatives of all Parties to participate in order to hold a meeting of the Working Group.

14. The Working Group shall report to the Commission on its progress and on the future direction of its work, within two years of the date of entry into force of this Agreement.

15. Decisions of the Working Group shall have effect only in relation to those Parties that participated in the meeting at which the decision was taken, except if:

(a) otherwise agreed by all Parties; or

(b) a Party that did not participate in the meeting requests to be covered by the decision and all Parties originally covered by the decision agree.


ANNEX 10-B

EXPRESS DELIVERY SERVICES

1. For the purposes of this Annex, express delivery services means the collection, transport and delivery of documents, printed matter, parcels, goods or other items, on an expedited basis, while tracking and maintaining control of these items throughout the supply of the service. Express delivery services do not include air transport services, services supplied in the exercise of governmental authority, or maritime transport services.

2. For the purposes of this Annex, postal monopoly means a measure maintained by a Party making a postal operator within the Party's territory the exclusive supplier of specified collection, transport and delivery services.

3. Each Party that maintains a postal monopoly shall define the scope of the monopoly on the basis of objective criteria, including quantitative criteria such as price or weight thresholds.12

4. The Parties confirm their desire to maintain at least the level of market openness for express delivery services that each provides on the date of its signature of this Agreement. If a Party considers that another Party is not maintaining that level of market openness, it may request consultations. The other Party shall afford adequate opportunity for consultations and, to the extent possible, provide information in response to inquiries regarding the level of market openness and any related matter.

5. No Party shall allow a supplier of services covered by a postal monopoly to cross-subsidise its own or any other competitive supplier's express delivery services with revenues derived from monopoly postal services.

6. Each Party shall ensure that any supplier of services covered by a postal monopoly does not abuse its monopoly position to act in the Party's territory in a manner inconsistent with the Party's commitments under Article 9.4 (National Treatment), Article 10.3 (National Treatment) or Article 10.5 (Market Access) with respect to the supply of express delivery services.

7. No Party shall:

(a) require an express delivery service supplier of another Party, as a condition of authorisation or licensing, to supply a basic universal postal service; or

(b) assess fees or other charges exclusively on express delivery service suppliers for the purpose of funding the supply of another delivery service.

8. Each Party shall ensure that any authority responsible for regulating express delivery services is not accountable to any supplier of express delivery services, and that the decisions and procedures that the authority adopts are impartial, non-discriminatory and transparent with respect to all express delivery service suppliers in its territory.


ANNEX 10-C

NON-CONFORMING MEASURES RATCHET MECHANISM

Notwithstanding Article 10.7.1(c) (Non-Conforming Measures), for Viet Nam for three years after the date of entry into force of this Agreement for it:

(a) Article 10.3 (National Treatment), Article 10.4 (Most-Favoured Nation Treatment), Article 10.5 (Market Access) and Article 10.6 (Local Presence) shall not apply to an amendment to any non conforming measure referred to in Article 10.7.1(a) (Non Conforming Measures) to the extent that the amendment does not decrease the conformity of the measure, as it existed at the date of entry into force of this Agreement for Viet Nam, with Article 10.3 (National Treatment), Article 10.4 (Most-Favoured-Nation Treatment), Article 10.5 (Market Access) or Article 10.6 (Local Presence);

(b) Viet Nam shall not withdraw a right or benefit from a service supplier of another Party, in reliance on which the service supplier has taken any concrete action, through an amendment to any non conforming measure referred to in Article 10.7.1(a) (Non Conforming Measures) that decreases the conformity of the measure as it existed immediately before the amendment; and

(c) Viet Nam shall provide to the other Parties the details of any amendment to any non-conforming measure referred to in Article 10.7.1(a) (Non-Conforming Measures) that would decrease the conformity of the measure, as it existed immediately before the amendment, at least 90 days before making the amendment.


CHAPTER 11

FINANCIAL SERVICES

Article 11.1: Definitions

For the purposes of this Chapter:

cross-border financial service supplier of a Party means a person of a Party that is engaged in the business of supplying a financial service within the territory of the Party and that seeks to supply or supplies a financial service through the cross-border supply of such a service;

cross-border trade in financial services or cross-border supply of financial services means the supply of a financial service:

(a) from the territory of a Party into the territory of another Party;

(b) in the territory of a Party to a person of another Party; or

(c) by a national of a Party in the territory of another Party,

but does not include the supply of a financial service in the territory of a Party by an investment in that territory;

financial institution means any financial intermediary or other enterprise that is authorised to do business and regulated or supervised as a financial institution under the law of the Party in whose territory it is located;

financial institution of another Party means a financial institution, including a branch, located in the territory of a Party that is controlled by persons of another Party;

financial service means any service of a financial nature. Financial services include all insurance and insurance-related services, and all banking and other financial services (excluding insurance), as well as services incidental or auxiliary to a service of a financial nature. Financial services include the following activities:

Insurance and insurance-related services

(a) direct insurance (including co-insurance):

(i) life;

(ii) non-life;

(b) reinsurance and retrocession;

(c) insurance intermediation, such as brokerage and agency; and

(d) services auxilia